Preamble

[Mr. SPEAKER in the Chair.]

Oral Answers to Questions — IRAN.

SETTLEMENT TERMS.

Mr. Wedgwood: asked the Secretary of State for Foreign Affairs, whether the settlement with Iran involves a charge upon the British taxpayer for oil, transport or subvention; whether any estimate has been formed of the amount of this charge; and whether the Iranian Government is making any contribution to Great Britain for the cost of the protection provided by the army of occupation which must otherwise fall upon British or Indian funds?

The Secretary of State for Foreign Affairs (Mr. Eden): As regards the first two parts of the Question, no final arrangement has yet been come to, but the considerations referred to by my right hon. Friend will be borne in mind. As regards the last part of the Question, the British Forces now in Persia do not constitute an army of occupation. No charge is being made upon the Persian Government for the cost of British or Soviet troops, but facilities are being provided by the Persian Government. As the British Forces do not constitute an army of occupation, what they require are facilities, not funds.

Mr. Wedgwood: May we in future, expect the Government to call the Government of that country the Persian Government and not the Iranian Government?

Mr. Eden: I do not know that I wish to go into that problem now, but perhaps the right hon. Member knows that to some Persians to call their country Persia is like calling Britain Wessex.

COMMUNICATIONS.

Captain Plugge: asked the Secretary of State for Foreign Affairs whether he proposes to take over the Iranian post office which controls telegraph radio communications with Berlin and Rome?

Mr. Cary asked: the Secretary of State for Foreign Affairs whether the telegraph system and wireless stations in Persia are to be placed under the control of the British and Indian Governments?

Mr. Eden: It is not the policy of the Allies to intervene in the administration of Persia except where circumstances make our intervention necessary in the Allied interest. In those parts of the country now occupied by British troops, the military authorities have taken the necessary measures to ensure the safety of their communications.

DIPLOMATIC STAFFS.

Mr. Simmonds: asked the Secretary of State for Foreign Affairs the number of Germans who have been permitted to leave Iran in consideration of their diplomatic status; and also the number of British citizens with diplomatic status who were resident in Iran at the commencement of September, 1941?

Mr. Eden: As regards the first part of my hon. Friend's Question, the number was 24 men and 16 women and domestic staffs. The staff of the British Legation in Teheran and their families numbered about 60 on 1st September. In addition, there are the staffs of the various British Consulates in Persia which, including British Indian subjects, number about the same.

INTERNATIONAL BRIGADE (INTERNEES, FRANCE).

Mr. Wedgwood: asked the Secretary of State for Foreign Affairs what representations have been made, since the war started, by His Majesty's Government to either the United States Government or the French Government concerning those of the International Brigade interned in France, some of whom are British subjects; and, further, whether any communications on this subject have been exchanged with the Union of Soviet Socialist Republics?

Mr. Eden: No communications have passed between His Majesty's Government


and either the United States Government, the French Government, or the Soviet Government on this subject since the outbreak of war. In view of the fact that before the end of the Civil War the Spanish Republican Government repatriated all those members of the International Brigade who were British subjects, there are, according to my information, no British members of the Brigade now interned in France.

Mr. Wedgwood: Considering the fact that these International Brigaders fought for our cause, it is not possible to do something to induce the French to release these people, if only to go to Mexico?

Mr. Eden: I should not feel confident that representations of the British Government to Vichy would be likely to produce good results.

Miss Eleanor Rathbone: Is my right hon Friend aware that there are about 3,000 International Brigaders of all nationalities interned under very painful conditions in France? Could be possibly interest the United States Government or some other Government to intercede for these men?

ALLIED GOVERNMENTS (MEETINGS).

Mr. Mander: asked the Secretary of State for Foreign Affairs whether he will give an assurance that equality of treatment between our Allies in respect of membership of the Inter-allied Conference will be accorded without regard to the occupation partial or complete, of their territories by the enemy or precise diplomatic status, race, creed or colour?

Mr. Eden: The meetings of the Allied Governments have been convened to discuss special problems, and no standing conference with a fixed membership has been established. The points mentioned by my hon. Friend, together with other relevant considerations, will, of course, be borne in mind in connection with such meetings.

Mr. Mander: Do I understand that it is intended that in due course all our Allies shall take their place at the table?

Mr. Eden: I think my answer covers that.

SYRIA (ARMISTICE SIGNATORIES)

Mr. Mander: asked the Secretary of State for Foreign Affairs why General Catroux, Commander-in-Chief of the Free French Forces in the Middle East, was not one of the signatories to the Armistice terms in Syria?

Mr. Eden: The Armistice terms were signed by General Wilson as Commander-in-Chief of the Allied Forces in Syria. General Catroux took part in the negotiations and was fully in accord with the agreement made.

Mr. Mander: In view of the very great part played by Free French Forces in the conquest of Syria, would it not have been a graceful act to have allowed their General to have signed the Armistice terms?

Mr. Eden: I do not think there is anything unusual in this. The Commander-in-Chief signed the Armistice terms.

ABYSSINIA.

Mr. Noel-Baker: asked the Secretary of State for Foreign Affairs (1) what is to be the status of the advisers to be appointed by His Majesty's Government to assist His Imperial Majesty the Emperor of Ethiopia and to whom these advisers will be responsible;
(2) whether he has a statement to make concerning the restoration of diplomatic relations between His Majesty's' Government and His Imperial Majesty the Emperor of Ethiopia?

Mr. Eden: The points to which my hon. Friend refers are dealt with in a draft agreement, which has been a matter of friendly discussion with the Emperor of Ethiopia and is now under consideration by His Majesty's Government. I have every hope that it will be signed in the near future.

Mr. Noel-Baker: Is the right hon. Gentleman aware that certain articles published recently contained the impression that we were trying to get a protectorate in Ethiopia, and the sooner that impression is dispelled the better?

Mr. Eden: I am not responsible for articles published but I can assure the hon. Member and the House that His Majesty's Government have no intention of pursuing any such policy.

Mr. Wedgwood: asked the Secretary of State for Foreign Affairs whether, in view of the difficulties now being experienced by the Emperor of Abyssinia, he contemplates any change in the supervising administration of what used to be Italian East African territory, with a view to obtaining more sympathetic and progressive co-operation?

Mr. Eden: I would refer my right hon. Friend to the reply I have just given to my hon. Friend the Member for Derby (Mr. Noel-Baker). It is, and always has been, the policy of His Majesty's Government to render the aid and guidance for which the Emperor has asked. The best method of affording that aid, in the light of rapidly changing circumstances, is under constant review.

Mr. Wedgwood: Is the right hon. Gentleman aware that putting the matter into the hands of the military at the present time is not the best method of securing helpful co-operation with the Emperor?

Mr. Eden: I am not sure that the right hon. Gentleman is fair to the military, but, as I tried to point out, we are at present engaged in negotiations, as a result of which I hope that agreement will be reached, including the appointment of diplomatic representatives.

Mr. Horabin: asked the Secretary of State for Foreign Affairs whether he will undertake that no oil or other fuel will be provided by ports and bunkerage stations under British control for shipping provided by the Italian Government to remove Italian subjects from East Africa; and whether he will insist that the Italian Government themselves provide the necessary fuel from their own resources?

Mr. Eden: The adoption of my hon. Friend's suggestion would render the proposed scheme for evacuating Italian civilians from Ethiopia unworkable, because the vessels required for the transport of these Italian subjects could not carry all the fuel needed for the double journey. It has, however, been stipulated by His Majesty's Government that the Italian Government will be required to repay the cost of all the fuel supplied to the repatriation ships at the time of delivery.

CHINA (BRITISH RELIEF OF DISTRESS).

Mr. Noel-Baker: asked the Secretary of State for Foreign Affairs whether His Majesty's Government are prepared to give any assistance towards medical aid for war victims in China?

Mr. Eden: Yes, Sir. His Majesty's Government have agreed to make a grant-in-aid of £50,000 to the British Fund for the Relief of Distress in China to meet expenditure on the maintenance of ambulance units for the treatment of sick and wounded soldiers and on relief activities generally in the war zones of Free China. Application will be made to Parliament in due course for the provision of the necessary funds, as required.

FINLAND AND RUSSIA.

Mr. Horabin: asked the Secretary of State for Foreign Affairs whether he will inform the Finnish Government that this country will not hold itself morally responsible for the future of Finland if Finland does not come to a settlement with Russia?

Mr. Eden: Yes, Sir. His Majesty's Government have already addressed a warning to the Finnish Government through the Norwegian Minister at Hel-singfors to the effect that, if the Finnish Government persist in invading purely Russian territory, His Majesty's Government will be forced to treat Finland as an open enemy, not only while the war lasts but also when peace comes to be made.

Mr. Mander: Has any reply been received to that, and is there any time limit?

Mr. Eden: No reply has been received.

Mr. Pickthorn: Can my right hon. Friend explain what meaning he attaches to the words about this country holding itself morally responsible for another one, and, if he attaches any meaning, can he give us an assurance that we will not hold ourselves morally responsible for the future of any other country?

Mr. Eden: That phrase was used in the Question. My answer was what I stated.

Mr. Mander: Will the right hon. Gentleman consider imposing a time limit so that the matter will not drag on?

Mr. Eden: I should be grateful if my hon. Friend would leave me to handle these negotiations in my own way.

FRENCH NORTH AFRICA (INTERNED BRITISH AIRMEN).

Lieutenant Butcher: asked the Secretary of State for Foreign Affairs whether he can give any information concerning the conditions under which British airmen are interned in French North Africa?

Mr. Eden: With the exception of one or two men in hospital all the British airmen in French North Africa, including those who were formerly in French Morocco and Tunisia, are, I understand, now interned at Aumale in Algeria. The internment camp is inspected from time to time by a member of the staff of the United States Consulate-General at Algiers. The United States Consul General reports that the men are as well treated as can be expected, and the conditions of the camp appear to be good.

Lieutenant Butcher: As disturbing reports reach this country, will my right hon. Friend personally cause inquiries to be made as to whether the camp is under the control of a French officer of suitable rank and whether dysentery is prevalent in the camp or not?

Mr. Eden: If my hon. and gallant Friend has some particulars, I will certainly go into them.

Oral Answers to Questions — ROYAL AIR FORCE.

INVALIDING (DEAFNESS).

Sir Francis Fremantle: asked the Secretary of State for Air how many men and women have been invalided out of the Air Force or incapacitated on account of defective hearing?

The Secretary of State for Air (Sir Archibald Sinclair): Since the outbreak of war, 141 officers and airmen have been invalided from the Royal Air Force on account of defective hearing. No women serving with the Royal Air Force have been invalided for this cause.

Sir F. Fremantle: Are arrangements being made to transfer these men to places where they can obtain useful training for employment, such as the National Institute for the Deaf?

OPERATIONS, RUSSIA.

Mr. Garro Jones: asked the Secretary of State for Air whether he can make any announcement on the subject of Royal Air Force units serving with the Soviet Union; and, in particular, to what extent they have been placed under the Russian Command?

Sir A. Sinclair: A wing of the Royal Air Force has been operating in Russia for several weeks, and up to Saturday last had destroyed 12 enemy aircraft, with the loss of only one of our fighters. The force is operating under the general command of the Commander of the Russian Air Forces on the Northern Front.

UNDER-SECRETARIES OF STATE (DUTIES).

Mr. Garro Jones: asked the Secretary of State for Air how administrative responsibilities, or duties, are divided between the two Under-Secretaries for Air?

Sir A. Sinclair: The broad division of responsibility between the two Parliamentary Under-Secretaries of State for Air in matters requiring Ministerial guidance is briefly as follows:—
My right hon. and gallant Friend the Member for the Isle of Thanet (Captain Balfour) assists in matters of policy arising in connection with Royal Air Force Training both at home and overseas, the Air Training Corps, and personnel administration generally. He continues to have a special responsibility to me for civil aviation policy and for the investigation and prevention of accidents. My Noble Friend who represents the Air Ministry in another place assists in matters of policy affecting works programmes, such as the selection and acquisition of sites and the availability of labour and material. He also has a special responsibility to me for welfare, education and public relations, and for questions in connection with the Meteorological Office and the Royal Observer Corps.

Commander Locker-Lampson: Have not both been found very useful?

Sir A. Sinclair: Yes, Sir.

ROME (BOMBING).

Mr. Simmonds: asked the Secretary of State for Air the number of occasions on which Rome has been bombed by the Royal Air Force?

Sir A. Sinclair: No attacks have been made on Rome by the Royal Air Force.

Mr. Simmonds: Is it not a fact that the bombing of the belligerent capitals has held clown around those cities vast antiaircraft defences; and would not my right hon. Friend, therefore, reconsider whether it would not be desirable, at the appropriate time, to bomb some of the many military targets in Rome, in order that the anti-aircraft defences there should not be dispersed to the other targets which are more frequently visited?

Sir A. Sinclair: I can assure my hon. Friend that our bombing policy is constantly under consideration and review. But in the meantime, I have nothing to add. to the statement made yesterday by my right hon. Friend the Prime Minister.

Mr. Glenvil Hall: Would the right hon. Gentleman bear in mind that the lives of airmen and machines are worth preserving, and should not be used in wild-goose chases?

Sir A. Sinclair: Yes, Sir.

Mr. Leslie Boyce: Does the Government's policy of bombing Rome if Cairo is bombed still hold good?

Sir A. Sinclair: I have said that I have nothing to add to the statement which the Prime Minister made yesterday.

PAN AMERICAN AIRWAYS-AFRICA, LTD.

Mr. Simmonds: asked the Secretary of State for Air upon what conditions and for what term of years he has granted permission to an American civil air line company to operate an air line across Africa?

Sir A. Sinclair: An Agreement has been entered into between His Majesty's Government in the United Kingdom and Pan American Airways—Africa, Limited (a wholly-owned subsidiary of Pan American Airways Inc.) for the operation of an air transport service between West Africa and the Anglo-Egyptian Sudan. The Agreement is necessary to enable Pan American Airways to discharge obligations entered into by them with the Government of the United States in connection with the ferrying of aircraft across the South Atlantic and across Africa. The Agreement will

run for a period not exceeding one year from the start of the service or for such longer period as may be agreed between the parties.

Mr. Simmonds: In view of the fact that it is understood to be the policy of Pan American Airways to run an air line right around the world, will my right hon. Friend bear in mind in any further negotiations with this company or with the United States Government that there should be reciprocity for British air lines to fly over or call at United States territory?

Sir A. Sinclair: I will certainly bear in mind the suggestion that my hon. Friend has made, but I am sure he will agree that we should be very grateful to the United States for the great help that has been given.

Mr. Keeling: Will my right hon. Friend give an assurance that this Agreement will not be continued after the war?

Sir A. Sinclair: I think it would be premature to discuss any such matter.

BRICK MAKING.

Mr. Thorne: asked the Parliamentary Secretary to the Ministry of Works and Buildings whether all the brick-making machinery at Peterborough and Fletton is working to full capacity; what number of bricks are being made there each week; and whether there is a shortage of bricks at the present time in Great Britain?

The Parliamentary Secretary to the Ministry of Works and Buildings (Mr. Hicks): The yards in the Peterborough area are working to full capacity having regard to the lighting restrictions. It would not be in the public interest to give the information asked for in the second part of the Question, but in reply to the last part of the Question I am glad to be able to inform the hon. Member that there is no shortage of bricks in Great Britain at the present time.

Mr. Thorne: Are all the hand brick-makers in the country fully engaged?

Mr. Hicks: I could not answer that.

Mr. Craven-Ellis: If there is no shortage of bricks in this country, will my hon. Friend consider using bricks for runways on aerodromes?

Oral Answers to Questions — ROYAL NAVY.

LOWER DECK COMPLAINTS.

Mr. Glenvil: Hall asked the First Lord of the Admiralty whether he is aware that some naval officers appear unaware of the established machinery for the ventilation of complaints by men from the lower deck; and whether, for the guidance of all concerned, he will cause the notices indicating the procedure to be followed prominently displayed in ships and shore establishments in peace-time to be circulated for screening throughout His Majesty's ships and establishments?

The Parliamentary Secretary to the Admiralty (Sir Victor Warrender): From time to time the attention of all officers and men is specially drawn to the regulations dealing with the proper procedure for the ventilation of complaints, and my right hon. Friend has had no reason to suppose that any officer is unaware of the established machinery for this purpose. The regulations direct that notices indicating the procedure to be followed are permanently to be displayed in an accessible part of His Majesty's ships and read every quarter to the ship's company. While no failures to display or read these notices have been reported, my right hon. Friend has felt it desirable to issue further orders calling attention to the regulation and to the necessity for its strict observance in His Majesty's ships and naval establishments.

Mr. Hall: Is the hon. Gentleman aware that his announcement will cause a good deal of satisfaction in some of His Majesty's ships, where difficulties have arisen owing to the lack of such observance?

CADET SCHOLARSHIPS.

Mr. Glenvil Hall: asked the First Lord of the Admiralty the number of applications received for entry under the Naval Cadet Scholarship Scheme this September; how many of these were from the usual preparatory schools, grant-aided secondary schools and other schools, respectively; whether the full number of scholarships have been awarded to the last two categories and to the son of a naval or ex-naval rating; and the extent to which these compared, educationally and physically, with the preparatory school candidates?

Sir V. Warrender: As the reply is rather long, I will, with my hon. Friend's permission, have it circulated in the OFFICIAL REPORT.

Mr. Hall: Will the hon. Gentleman be good enough to give some brief indication of what the Answer will be?

Sir V. Warrender: It is a little difficult to do that. I gather that what the hon. Member really wants to know is the number of scholarships awarded. I can assure him that to candidates from both grant-aided schools and other schools the full number of scholarships was awarded.

Following is the reply:

The numbers were—


(a) From grant-aided Secondary Schools 
279


(b) Scholarship candidates from other schools 
65


(c) Ordinary entry only 
66

Those in groups (b) and (c) came mostly from the usual preparatory schools. Some of the scholarship candidates were also candidates for the ordinary entry. The full number of scholarships has been awarded to each of the categories (a) and (b).

One son of an ex-rating was successful in obtaining one of the ordinary scholarships from the secondary schools. No other son of a rating or ex-rating reached the standard required of the scholarship candidates; the special scholarship for a son of a rating or ex-rating was, therefore, not awarded.

The number of candidates from the other schools who did as well or better than the top candidates from the secondary schools was ten, so that all these obtained scholarships and it can be said that the two classes of candidates were equal educationally. No comparison was made between the two classes of candidates from a physical point of view, but it can be stated that the number of medical rejections amongst the secondary school candidates was not above the normal.

INVALIDING (DEAFNESS).

Sir F. Fremantle: asked the First Lord of the Admiralty how many men and women have been invalided out of the Navy or incapacitated on account of defective hearing?

Sir V. Warrender: During the period 1st September, 1939, to 31st March, 1941, 287 men were invalided out of the Navy on account of defective hearing. One member of the W.R.N.S. was also invalided for this reason. The full figures for recent months are not yet available.

Sir F. Fremantle: Are steps being taken to find satisfactory employment for these men, who may be extremely useful?

Sir V. Warrender: I will make inquiries on that point and let my hon. Friend know.

WOODWORK CONTRACTS, SCOTLAND.

Mr. Leonard: asked the First Lord of the Admiralty how many Scottish firms are on the tendering lists for woodwork; and of that number how many are situated in the district notified to him?

Sir V. Warrender: The total number in Scotland is 22, of which nine are situated within the area to which my hon. Friend refers. These firms contract direct to the Admiralty for woodwork. There are, in addition, sub-contractors, some of whom may well be important firms. I regret that the number of these sub-contractors cannot be readily ascertained.

Oral Answers to Questions — JAMAICA.

CONSTITUTION.

Mr. Creech Jones: asked the Undersecretary of State for the Colonies whether he can make a statement on the position of the proposals for a new constitution for Jamaica; and what further action His Majesty's Government intend to take?

Mr. Whiteley (Comptroller of the Household): I have been asked to reply. The proposals for a reform of the constitution of Jamaica which were submitted to the Legislative Council have been rejected, and the Council have passed a resolution for a bi-cameral legislature, as in the scheme proposed by them in 1939. The question of future action is under consideration and no decision has yet been taken.

Mr. Creech Jones: Will my hon. Friend make representations along the lines that the Legislative Council decision is an entirely unrepresentative one, and that it in no way represents the general feeling of the people of Jamaica?

DETENTIONS.

Mr. Sorensen: asked the Undersecretary of State for the Colonies whether, in view of the injury to the British cause arising from the continued detention of W. Domingo, he can yet make any report on the matter; whether Miss Muriel Lester was detained by order of the Governor; and whether he approves the policy of the Governor of treating with hostility any progressive political or religious spokesman who publicly discusses West Indian affairs?

Mr. Whiteley: As regards the first part of the Question, my Noble Friend has nothing to add to the statement made in reply to a Question by my hon. Friend on 10th September, except that the Governor has since reported that Mr. Domingo has exercised his right to make an objection to the Advisory Committee and that his case is in process of being heard. The answer to the second part of the Question is in the affirmative. As regards the last part of the Question, my Noble Friend is quite unable to accept the suggested criticism of the action taken by the Governor of Jamaica and the Governor of Trinidad in these two cases.

Mr. Sorensen: Is my hon. Friend aware that no one has been detained by the Governor except people of progressive tendency, and will he expedite further information regarding the most unfortunate detention of Mr. Domingo?

Mr. Whiteley: If my hon. Friend would care to see me afterwards, I think he might realise the situation a little more fully than he does at present.

Sir Leonard Lyle: Is it not the fact that Mr. Domingo was suspected not only by the British authorities but by the authorities in the United States of America of intending to cause disaffection in the construction of the naval and air bases, and will my Noble Friend the Colonial Secretary make it quite plain that he intends to support our Government in any reasonable action they may take to deal with subversive action against the Imperial well-being?

Mr. Creech Jones: Is it not a fact that Mr. Domingo has constantly given his whole-hearted support to the British war effort, both in America and in other Colonies that he has visited?

Mr. Whiteley: As this man has appealed and his case is being heard, I think we had better wait until the appeal has been heard.

Mr. Sorensen: Has not the hon. Gentleman who addressed a Question to my hon. Friend a moment ago prejudged the case by his statement?

GOLD COAST (LOCAL GOVERNMENT).

Mr. Creech Jones: asked the Undersecretary of State for the Colonies whether steps are being taken in the Gold Coast to reorganise local government and develop responsible municipal authorities?

Mr. Whiteley: These questions which, owing to local circumstances, present a difficult and complex problem, have been engaging the attention of the Gold Coast Government for some time. The new Governor of the Gold Coast will be assuming his duties shortly, and these matters will be considered by him with a view to his submitting recommendations.

COLONIAL DEVELOPMENT AND WELFARE.

Mr. Creech Jones: asked the Undersecretary of State for the Colonies whether a White Paper will be published setting out the development programmes submitted by the respective Governments for consideration under the Colonial Development and Welfare Act, 1940?

Mr. Whiteley: My Noble Friend will bear my hon. Friend's suggestion in mind, but he would prefer to defer a decision on it. In any event, however, an annual return of schemes made under the Colonial Development and Welfare Act will be laid before Parliament in accordance with Section 1 (4) of the Act.

Mr. Creech Jones: Will my hon. Friend make representations that we really want to know what schemes are submitted by the respective Governments and not necessarily only the schemes submitted to this House for the necessary finance?

Mr. Whiteley: I appreciate what my hon. Friend has in mind, and I will convey that suggestion to my Noble Friend.

Sir F. Fremantle: When is the report likely to be made?

Mr. Whiteley: It is impossible to give that information at the moment.

NIGERIA (PALM KERNELS).

Mr. Edmund: Harvey asked the Under-Secretary of State for the Colonies whether his attention has been called to a demand in Nigeria for the withdrawal of the prohibition of the purchase for export and removal of palm kernels; and whether the scheme for Governmental purchase of palm kernels, which has been agreed to for the French Cameroons, can be applied also to Nigeria?

Mr. Whiteley: The prohibition of the purchase for export of palm kernels in certain areas of Nigeria has been suspended since 6th May, and for the present the whole exportable supply is being bought on behalf of the Ministry of Food.

AFRICAN COFFEE (PRICES).

Mr. Harvey: asked the Under-Secretary of State for the Colonies the price paid to African coffee growers for their coffee, under the coffee marketing scheme, as compared with the former prevailing price in Kenya and Tanganyika; and whether the interests of the African native growers are represented in any way on the Board of Control?

Mr. Whiteley: My Noble Friend has not yet received any information regarding the prices being paid to African coffee growers for the season which has just opened. The Government representation on the Board can be relied upon to ensure that the interests of the native producers are amply safeguarded.

BRITISH GUIANA (FRANCHISE COMMISSION).

Mr. Mathers: asked the Under-Secretary of State for the Colonies whether he is aware that the Franchise Commission appointed in British Guiana to advise on the suffrage and the qualifications for election to membership of the Legislative Council does not adequately represent all sections of the population and is not likely to ensure an impartial decision on the question of the present limited franchise; and whether he will see that the Commission is so constituted that its findings may merit public confidence?

Mr. Whiteley: The Commission was appointed in May last, and my Noble Friend has not received any representations regarding its composition. There are 23 members, of whom 10 are elected members of the Legislative Council. The remainder, who are all unofficials, include the Presidents of two of the local Labour Unions and the President of the Village Chairmen's Conference of the Colony.

Mr. Mathers: Will my hon. Friend indicate to his Noble Friend that the distrust of this Commission is due to the fact that it is chaired and largely dominated by those who worked the previous Constitution, and that their sympathies are looked upon as being against a proper democratic change?

Mr. Whiteley: I will convey that to my Noble Friend, but these people are appointed to these various committees and village councils, and from that it is taken that they have the full confidence of the people.

Oral Answers to Questions — WAR TRANSPORT.

TRAFFIC DIRECTION POSTS.

Mr. Purbrick: asked the Parliamentary Secretary to the Ministry of War Transport why, in view of the necessity for national economy, two traffic direction posts were placed at the intersection of Harefield Road and Park Road, Bucks, a junction which has been free from accidents; and why were two posts erected where one only would have been sufficient?

The Joint Parliamentary Secretary to the Ministry of War Transport (Colonel Llewellin): I am obliged to my hon. Friend for drawing my attention to this. A mistake was made and is being rectified.

Sir Stanley Reed: Will my right hon. and gallant Friend consider removing the thousands of direction posts which serve no useful purpose and arc a menace to pedestrians?

Colonel Llewellin: That seems to be rather a larger question.

WESTERN AVENUE (EXTENSION).

Mr. Purbrick: asked the Parliamentary Secretary to the Ministry of War Transport whether it is the intention of the Government to encourage the work

on the Western Avenue to by-pass Uxbridge; and, in view of the fact that practically no work has been done on this job during the last two years, whether they will get ahead with it and get it finished or stop the present intermittent work altogether, thereby releasing men, material and machinery for war purposes?

Colonel Llewellin: It is still hoped to complete the extension of the Western Avenue, and the work is proceeding as quickly as circumstances permit.

ROAD ACCIDENTS (SAFETY CAMPAIGN).

Captain Duncan: asked the Parliamentary Secretary to the Ministry of War Transport (1), whether he will seek the co-operation of the Ministry of Information and the Board of Education to run a propaganda campaign this winter with the object of reducing the number of casualties on the roads;
(2) what steps he is taking to reduce the number of accidents on the roads?

Colonel Llewellin: In war-time the measures that can be taken, whether by regulation or otherwise, to reduce road accidents are necessarily limited. The problem can only effectively be tackled with the full co-operation of all road users drivers, cyclists and pedestrians. We have accordingly arranged for an intensive road safety campaign to be undertaken by the Ministry of Information during the coming winter. This will make use of Press, Broadcasting and Film. The Board of Education are arranging for special attention to be given to the instruction of school-children in road safety questions. The Home Secretary has assured us that the police will do their utmost to ensure such traffic supervision as is possible under present conditions. With the help of the Committee of which I informed the House during the Debate on the Adjournment before the Recess, I am examining a number of suggestions in order that every practicable step may be taken to reduce road accidents.

Captain Duncan: While I thank my right hon. and gallant Friend for that reply, will he do everything he can to bring home to the public the appalling number of road accidents in war-time?

Colonel Llewellin: Yes, Sir.

Captain Duncan: asked the Parliamentary Secretary to the Ministry of War


Transport by what percentage the number of deaths and injuries to persons on the roads of Great Britain in 1940 exceeded the total casualties, excluding prisoners of war, to the British Expeditionary Force in 1939–1940; and whether the deaths and injuries so far in 1941 have exceeded those of 1940, and by how much?

Colonel Llewellin: The casualty figures of the British Expeditionary Force in 1939–40 have not been published. We have not got particulars of the number of injured during 1940 in road accidents. The number of deaths resulting from road accidents in the eight months January-August, 1941, exceeded those in the same period of 1940 by 1,465.

Captain Duncan: What was the percentage increase over the previous year?

Colonel Llewellin: I am afraid I did not work that out, and I cannot do so on the spur of the moment.

ROAD VEHICLES MAINTENANCE (LABOUR).

Mr. Craven-Ellis: asked the Parliamentary Secretary to the Ministry of War Transport whether, having regard to the urgent necessity in the national interest of maintaining road transport in a state of efficiency, he can assure the House that there is adequate skilled labour available for the proper servicing and repairing of essential road transport, and does he intend to publish the recent Report or a summary of the Report of the Motor Vehicle Maintenance Advisory Committee?

Colonel Llewellin: We are taking all practicable steps to ensure that adequate and suitable labour is available for the maintenance of essential road vehicles. A statement on the main recommendations of the Report of the Motor Vehicle Maintenance Advisory Committee and of the action being taken was published on 19th September.

DERELICT RAILWAY TRACKS.

Sir John Mellor: asked the Parliamentary Secretary to the Ministry of War Transport whether he will give directions that derelict lines of railway shall either be reopened for traffic or dismantled, so that the rails can be put to some useful purpose in the war effort?

Colonel Llewellin: The Railway Executive Committee has already taken action to ensure that appropriate use is made of any tracks no longer required for traffic purposes.

Commander Locker-Lampson: Does the same thing apply to tramway lines in streets?

Colonel Llewellin: The old tramway tracks are being taken up as labour is available to do so, and also to replace the road surface afterwards.

Oral Answers to Questions — FOOD SUPPLIES.

BLACKBERRIES (HEDGE TRIMMING).

Mr. Quibell: asked the Parliamentary Secretary to the Ministry of Food whether, in view of the shortage of soft fruit, he will consider advising local authorities and others concerned not to trim hedges and cut down the blackberry bushes until the fruit has been gathered?

The Parliamentary Secretary to the Ministry of Food (Major Lloyd George): A Press notice was issued to farmers on 26th August asking farmers to do their best to defer clipping hedges until the blackberries have been gathered. It has not been thought necessary to supplement this by a further notice to local authorities.

BRITISH RESTAURANTS AND WORKS CANTEENS.

Sir Percy Hurd: asked the Parliamentary Secretary to the Ministry of Food on what basis, as concerns price and priority and other details, food supplies are allotted to British Restaurants and other public centres as compared with private caterers?

Major Lloyd George: British Restaurants and other community meal centres are granted allowances of rationed foods in common with all other catering establishments on the basis of the number of meals they serve. They do not enjoy any privileged position in regard to buying facilities. Many of the British Restaurants have been set up for the purpose of feeding workers for whom canteen provision in their works is not practicable, and the British Restaurant as well as the works canteen has been given priority in the supply of certain manufactured articles and other un-rationed foods of which stocks are short.

Sir P. Hurd: Seeing that it is very difficult to follow this matter in this way, can my right hon. and gallant Friend say that these private caterers are really being given a fair deal as compared with municipal and other restaurants?

Major Lloyd George: Certainly, taking like with like, they are. Where in effect British Restaurants deal with large numbers of workpeople it is because these cannot yet be accommodated in other establishments or even in works canteens.

FOOD CONTROL OFFICIAL (CONVICTION).

Mr. Thorne: asked the Parliamentary Secretary to the Ministry of Food whether he can give any information in connection with the food control man at Richmond who was charged with having £2 worth of meat in his motorcar?

Major Lloyd George: The person referred to was at the time a member of the Richmond food control committee, and the manager of a butcher's shop. He was convicted on 15th September of attempting to supply unlawfully seven joints of meat to his own household at a place in Wiltshire, and was fined £50 and ordered to pay 15 guineas costs.

MILK SUBSTITUTES.

Mr. Thorne: asked the Parliamentary Secretary to the Ministry of Food whether he can given any information in connection with a London firm selling for 3s. a pound milk substitute which is made up of flour, salt and baking powder; and what action he intends to take about the matter?

Major Lloyd George: My Department purchased over the counter a sample of the product to which my hon. Friend refers, and has had it analysed. It was found to consist mainly of the materials mentioned in the Question. My Noble Friend is giving urgent consideration to the steps to be taken to protect the public against the sale of food substitutes of this kind.

Mr. Thorne: Can the Minister in any way make it known to this class of people that I and many other Members of this House will keep on chasing them until they put an end to this business?

Mr. Garro Jones: Is the Parliamentary Secretary aware that these abuses and

malpractices have been publicised in the Press for the last three, four or live weeks, and how long will it take before a decision is reached and preventive action taken?

Major Lloyd George: My hon. Friend will appreciate that analyses of these products take a considerable time in some cases, and the fact that they are food substitutes does not in itself make them harmful. What is of serious import is the exploitation of the public with regard to price, and that is one of the things in regard to which we can protect the public, and we will do that as soon as we can.

Mr. Garro Jones: When may we expect action?

Major Lloyd George: Very shortly.

Mr. Leonard: asked the Parliamentary Secretary to the Ministry of Food whether his attention has been drawn to the fine of £20 imposed upon a Glasgow firm at a court in Leeds for a misleading advertisement furthering the sale of a milk substitute for ice-cream; to the allegation that it consisted of 96 per cent. wheat flour and 4 per cent. milk sugar, and sold at 2s. 9d. per pound, although the cost of flour was only about 1d. per pound; and whether he will further restrain such firms?

Major Lloyd George: The answer to the first and second parts of the Question is "Yes, Sir." With regard to the last part, as I have already informed my hon. Friend the Member for Plaistow (Mr. Thome), my Noble Friend is giving urgent consideration to the steps to be taken to protect the public from the sale of food substitutes of this kind.

ORANGES (INVALIDS).

Mr. Mathers: asked the Parliamentary Secretary to the Ministry of Food whether he will arrange for supplies of oranges to be made specially available to invalids during the children's priority period or immediately that period comes to an end; and whether he will recognise the special requirements of tuberculosis patients?

Major Lloyd George: The Ministry's medical advisers are of the opinion that provided adequate supplies of vitamin C


are available there is no necessity to provide a special supply of oranges for anyone suffering from any type of disease or injury, and I regret that I cannot see my way to adopting my hon. Friend's suggestions.

Mr. Mathers: But a medical analysis does not satisfy the craving of an invalid who would be greatly benefited if the right hon. and gallant Gentleman could act on the suggestion contained in my Question.

Major Lloyd George: Naturally, we like to do what we can, but we are bound to take note of the advice of our medical people on this matter, and we are assured by them that it is possible, even in simple forms, to give them vitamin C.

Mr. MacLaren: What is meant by vitamin C?

MILK (CHILDREN).

Mr. Brooke: asked the Parliamentary Secretary to the Ministry of Food whether all children of school age are to be given priority claim to an equal minimum supply of fresh milk whether or not they attend a school where the State-subsidised Milk in Schools Scheme is operating; and will he explain the arrangements which are to apply to children not attending such schools?

Major Lloyd George: Under the scheme for controlling the distribution of liquid milk children not attending school will be entitled to a priority of 3½ pints a week after six years of age but previous to this will be eligible for a pint a day of free or cheap milk under the National Milk Scheme. For children attending school the same priority will be given to the supply of milk for consumption at school whether the milk is purchased under the Milk in Schools Scheme or not. Circulars fully describing the arrangements have been issued by the Board of Education, and I have arranged for copies of these to be sent to my hon. Friend.

Mr. Evelyn Walkden: Will retailers have guaranteed units of supply, in accordance with registration and age groups, for allocation?

Major Lloyd George: I think I can give that assurance. I know there was trouble once or twice last year, but I do not think it will occur this year.

EGG DISTRIBUTION SCHEME (COST).

Sir L. Lyle: asked the Parliamentary Secretary to the Ministry of Food the present annual cost of his staff needed to ensure the working of the egg distribution scheme; and what is the estimated loss hitherto under the scheme of imported eggs which have become rotten before reaching the consumer at all. or in an edible form?

Major Lloyd George: The present estimated annual cost of the Ministry's staff engaged on eggs is £145,000. In addition to the work in connection with the egg distribution scheme, this staff also deals with the importation and distribution of frozen eggs and dried and processed eggs. Since the introduction of the egg scheme the total allowances made in respect of bad imported eggs amount to £98,154, representing 5.3 per cent. on U.S.A. eggs; 5.8 per cent. on Canadian eggs and 1.75 per cent. on Eire eggs.

Sir L. Lyle: Is not £145,000 a very high price to pay for three doubtful eggs per month?

Major Lloyd George: At any rate 45,000,000 people are getting these three doubtful eggs per month. If my hon. Friend will be good enough to work out the figures, he will find that the cost is a small proportion of a penny per head.

Sir L. Lyle: Would it not be much cheaper to import the feeding-stuffs which are necessary? Would it not be much more efficient and would we not possibly get some fresher eggs?

Major Lloyd George: Of course, that has occurred to us, but there is very great doubt as to whether it is not better to import eggs rather than feeding-stuffs. My hon. Friend is assuming that if we did import more feeding-stuffs, they would of necessity go to poultry keepers, but that is not by any means so. We weighed up the advantages of importing this commodity or that, and we came to the conclusion that it is better to import the finished article.

Commander Sir Archibald Southby: Might not the Ministry come down on the side of fresh eggs rather than bad eggs?

Mr. Graham White: asked the Parliamentary Secretary to the Ministry of Food whether the experience of the administration of the egg control scheme


to date confirms the estimated expenditure previously announced?

Major Lloyd George: Yes, Sir.

POULTRY STOCKS.

Sir L. Lyle: asked the Parliamentary Secretary to the Ministry of Food whether he can make any statement as to the numbers of poultry stocks now and six months ago; and whether, to avoid reductions of stocks next year, he will consider increasing the importation of feeding-stuffs and decreasing the importation of foreign eggs?

Major Lloyd George: Any comparison of poultry stocks between now and six months ago is misleading owing to the marked seasonal variation in numbers, but the stocks of England and Wales have declined by approximately 30 per cent. during the period mentioned. My noble Friend is not prepared to decrease the importation of foreign eggs and the maximum possible quantity of animal feeding-stuffs is being and will continue to be brought into this country having regard to the demands on shipping space.

MARKET GARDEN PRODUCE (PRICES).

Mr. Douglas: asked the Parliamentary Secretary to the Ministry of Food whether he will take steps to have published in the Press and by broadcasting the prices at which market-garden produce, and other foodstuffs liable to rapid variation in price, are being sold in the markets, in order that housewives may have information enabling them to judge the fairness of the prices asked by retailers?

Major Lloyd George: I assume that my hon. Friend has perishable goods such as vegetables and fruit primarily in mind. The market prices of many of these commodities are already published in the Press, but I fear that it would not be practicable to broadcast this information since the prices of perishable goods naturally vary in different markets in different parts of the country.

PUBLIC TRANSPORT DRIVERS AND CONDUCTORS (RATIONS).

Mr. Sorensen: asked the Parliamentary Secretary to the Ministry of Food whether, in view of increased strain imposed on public transport drivers and con-

ductors, he will consider granting to them the extra rations already granted to some workers?

Major Lloyd George: The special ration of cheese is granted solely to meet the needs of certain categories of workers who require to take suitable food with them to their work and who are unable to make use of canteen facilities. I do not feel, therefore, that the concession can be given to the drivers and conductors in question. The possibility of improving the provision of food supplies for the men in question while they are at work is, however, receiving close attention.

Mr. Sorensen: Would the Parliamentary Secretary consider placing this category of workers on the list of priority workers?

Major Lloyd George: If the hon. Gentleman will be good enough to wait until the next Sitting Day, I shall be able to give him an answer.

SMALL TRADERS (LICENSING).

Sir L. Lyle: asked the Parliamentary Secretary to the Ministry of Food the number of small shopkeepers in the whole country from whom licences to trade with registered customers have been withdrawn; and how many of these were in Bournemouth?

Major Lloyd George: Statistics up to date show that supplies of one or more rationed foods were no longer being made available to 13,343 retailers in the United Kingdom; of these three are in the Bournemouth Food Control Committee area.

Sir L. Lyle: Is not that position very unsatisfactory, in view of what we were led to expect by the Minister when the question was raised before? Would it not be better to revert to the old position where the Ministry licensed the smaller retailer automatically unless there was a case against him? At the moment they only licence him when he can show hardship, which is very unsatisfactory.

Major Lloyd George: My hon. Friend will remember that when I spoke about this matter some time ago I said that the main purpose was not to encourage people in this kind of business if they were not there for legitimate trade purposes. When he says that the situation is not satisfactory that may mean not satisfactory either


way. It may well mean that we are getting rid of something which might well have been got rid of before. So far as Bournemouth is concerned, I think that three out of the whole area is extremely satisfactory from my hon. Friend's point of view. Moreover, he knows that it is possible for people who have complaints to appeal and that and this withdrawal of rationed foodstuffs may be in respect of one rationed commodity or more.

Sir L. Lyle: While recognising that nobody wants to support people who are abusing the control of food rationing, will it not be possible to revert to the old system of licensing a retailer unless there is a case against him? At present he is not licenced unless he can show hardship.

Major Lloyd George: If my hon. Friend will look into the three cases in his constituency and let me have his views on them, it might help a very great deal.

Oral Answers to Questions — MINISTRY OF SUPPLY.

WASTE PAPER COLLECTION.

Sir P. Hurd: asked the Parliamentary Secretary to the Ministry of Supply whether, in view of the fact that sufficient waste could be collected to operate paper-mills at an appreciably higher percentage, steps will be taken to put more drive into the collection of waste paper?

The Joint Parliamentary Secretary to the Ministry of Supply (Mr. Harold Macmillan): During the past few months additional steps have been taken to stimulate the collection of waste paper by the organisation of county salvage drives and by the increased enlistment of the help of voluntary organisations. In addition, widespread support is being given to the salvage campaign by the Press throughout the country.

Sir P. Hurd: What has been the result?

Mr. Macmillan: Very satisfactory, but we still want additional effort.

Commander Locker-Lampson: Will my hon. Friend try to stop the sending of circulars to Members of Parliament and save a little money that way?

SUBSTITUTE GASES.

Sir Granville Gibson: asked the Parliamentary Secretary to the Ministry of Supply (1) what annual tonnage of shipping space is being employed for the importation from America of calcium carbide used for the production of acetylene gas for oxygen cutting and welding;
(2) what steps have been taken to encourage the use of home-produced substitute gases available; and whether any recommendations by the Ministry have been opposed by carbide and acetylene interests;
(3) in view of the large amount of carbide imports what further steps will be taken to encourage the use of home-produced alternatives; is any factory for the production of calcium carbide for acetylene gas generation contemplated or under construction in this country; and, if so, when will it be in production, and what percentage of our total requirements will it produce?

Mr. Harold Macmillan: The substitute gases available are of limited application. The most important is coal gas and detailed advice has been given twice this year to using industries on its method of application, and they have been urged to use it wherever practicable. This advice is, I am glad to say, widely followed. Other substitute gases are in limited supply. I have no reason to suppose that the use of substitute gases has been limited by opposition from any interests concerned in carbide and acetylene. There is a factory in this country for the production of calcium carbide and another is in course of erection, but it would not be in the public interest to give particulars of home output or of imports.

CONTRACTS.

Mr. Keeling: asked the Parliamentary Secretary to the Ministry of Supply whether any recent contracts have been placed on a cost-plus-percentage basis; and whether he can give an assurance that all future contracts will be made either at a fixed price or on a cost-plus-fixed-profit basis?

Mr. Harold Macmillan: During the four weeks ended 16th September, 1941, two contracts were placed on the basis of payment to the contractor of actual ascertained cost plus a percentage of the cost


as profit. This type of contract has only been made because it was not possible to estimate the extent or cost of the work in advance.

ADVERTISEMENT HOARDINGS.

Major Sis George Davies: asked the Parliamentary Secretary to the Ministry of Supply whether his attention has been called to the large numbers of advertising hoardings and billboards no longer required for the purposes for which they were erected, which are, in many cases, eye-sores and possible sources of danger in case of conflagration caused by enemy action; and whether he will look into the possibility of removing them and using the timber for more immediately useful purposes?

Mr. Harold Macmillan: The question of recovering timber from hoardings has repeatedly been considered but in view of the poor condition of most of the timber and of the heavy wastage involved in recovering it, the employment of labour for this purpose could not be justified in present conditions.

ROAD TRANSPORT VEHICLES (SPARE PARTS).

Mr. Craven-Ellis: asked the Parliamentary Secretary to the Ministry of Supply (1) whether he is satisfied with the rate and volume of production of new spare parts and tyres for road transport vehicles? (2) whether the demand for spare and replacement parts and tyres exceeds the available supply; what steps he is taking, cither to reduce the demand or increase the supply; and what steps have been taken or are contemplated for reclaiming and reconditioning used spare parts?

Mr. Harold Macmillan: I am satisfied that the action taken by the Ministry of Supply is resulting in a supply of spare parts sufficient to meet the requirements of essential civil transport. Greatly increased allocations of raw materials and productive capacity have been made for this purpose. As regards the supply of tyres, a scheme has been introduced in conjunction with the Ministry of War Transport, for ensuring that tyres are available for essential vehicles. This scheme is working smoothly. The Ministry of Supply, has also directed vehicle manufacturers to arrange for reclaiming and reconditioning used spare parts wherever practicable.

Mr. Craven-Ellis: Is my right hon. Friend now satisfied that the production of spare parts is of such volume that civilian transport is now being turned out on repair quicker than it has been previously?

Mr. Macmillan: Yes, Sir. I am not wholly satisfied with the position, but there has been a very great improvement since the beginning of this scheme, and I am confident it will meet all needs.

SCRAP METAL (RAILINGS).

Mr. R. Morgan: asked the Parliamentary Secretary to the Ministry of Supply what is the full nature of the instructions issued to local authorities in respect of the requisitioning of iron and steel railings for scrap purposes?

Mr. Harold Macmillan: Local authorities in England and Wales were asked on nth September to complete a survey of the railings in their areas within six weeks and to schedule those which in their view were unnecessary. They have been asked to interpret "unnecessary" so as to exclude from scheduling railings which in their opinion serve a useful function and which, if removed, would require to be replaced by some other material. In particular, railings required for safety purposes or to prevent cattle straying, and railings of historic interest or special artistic merit will not be scheduled. The requisition of railings will commence as soon as possible after these schedules have been received. The scheme will be extended to Scotland shortly, as soon as the necessary arrangements are completed. A copy of the instructions to local authorities is being placed in the Library of the House.

Mr. Thorne: Am I to understand that when the survey is made it is intended to requisition all the railings, and is the Minister aware that not long ago a statement was made that all the iron from wrecked houses was not required for blast furnace and steel-making purposes?

Mr. Macmillan: The first step is to make a schedule, and the second step is to requisition the railings as and when they may be needed, and to take them stage by stage for the purposes of iron and steel manufacture.

Mr. Thorne: Is it intended to take the large girders and so on in parts of London


and other parts of the country where houses have been bombed?

Mr. Macmillan: They are being moved at a very satisfactory rate. I think the figure given me was that about 8,000 tons were moved in the course of last week.

Oral Answers to Questions — MINISTRY OF INFORMATION.

BRITISH BROADCASTING CORPORATION.

Sir Irving Albery: asked the Minister of Information whether he has now assumed full responsibility for all the activities of the British Broadcasting Corporation in so far as they are connected with the war effort?

Mr. Garro Jones: asked the Minister of Information whether any single Minister or body now exercises control over the British Broadcasting Corporation; who is responsible for the selection of political speakers, other than Ministers, over the microphone; whether the Parliamentary reports are edited or censored or Ministerially approved, and, if so, by whom; and to what extent the Governors now exercise authority?

The Parliamentary Secretary to the Ministry of Information (Mr. Thurtle): The B.B.C. accepts the direction of the Ministry of Information in all matters affecting the national effort, except that, as the Prime Minister has stated in the House, propaganda to enemy and enemy-occupied territories is now controlled by a joint Ministerial Committee working through an executive body. Political speakers do not broadcast except with the approval of the Ministry of Information. The B.B.C.'s Parliamentary reports are edited by their news staff under the general supervision of the Ministry. The Board of Governors continue to exercise authority over the Corporation's affairs within the limitations that I have stated.

Sir I. Albery: Does that mean, shortly, that the Governors of the B.B.C. are no longer responsible for any part of the B.B.C.'s activities connected with the war? Is that the result of the Minister's answer?

Mr. Thurtle: I think the hon. Member may assume that is what is intended by my answer.

Mr. Garro Jones: On a point of Order. Is it quite satisfactory for the Minister to answer two Questions, one of which is of an omnibus character and lends itself to a similar reply, and the other of which is of a precise character calling for a precise answer? May I have a precise answer to that part of my Question which asks whether Parliamentary reports are edited or censored or Ministerially approved, and if so, by whom?

Mr. Thurtle: As was stated in my answer, these reports are edited by the news staff of the B.B.C. under the general supervision of the Ministry of Information.

Mr. Garro Jones: Is not that just the vague type of answer of which I was respectfully complaining? Are they Ministerially approved, and if so, by whom?

Mr. Thurtle: We have a link with the B.B.C, and if there is anything which our officer thinks is wrong about the way in which the news is presented, he draws the attention of the Ministry of Information to it, and in that way we exercise supervision.

Sir Percy Harris: Do the Government interfere with the presentation of the speeches made in this House as reported by the B.B.C?

Mr. Thurtle: I would like to have notice of that Question.

Sir A. Southby: Does the Minister mean by his answer to the original Question that the Government have in fact taken over the B.B.C. to an enormous extent, and if that be so, am I right in assuming that questions concerning the B.B.C. should now be put to the Minister of Information?

Mr. Thurtle: My answer stated that in all matters affecting national policy the Ministry of Information are responsible and not the B.B.C.

Mr. Leach: Will my hon. Friend take into consideration the advisability of putting on to this work some of those very capable Russians who are doing it for their country?

Sir I. Albery: asked the Minister of Information why the British Broadcasting Corporation advertise for young


female clerks and typists when all employers are being urged to replace young with older women; and why such appointments are not filled through the Ministry of Labour?

Mr. Thurtle: I am informed that the B.B.C. does not advertise for "young female clerks and typists"; that a minimum age only is stipulated and the fullest consideration is given to older women; and that the Corporation only advertises in cases where the Ministry of Labour is unable to supply the Corporation's needs.

Sir I. Albery: Has the Minister seen the advertisements which have appeared, I think in the "Times" and other newspapers, and if not, will he look at them and reconsider his answer?

Mr. Thurtle: Certainly, I will take pleasure in looking at the advertisements.

Sir John Wardlaw-Milne: Will the Minister also look at the answer given to me about a month ago regarding a certain town in the Midlands, the name of which for obvious reasons was not given, and take note of the very large proportion of Young men and young women of military age employed by the B.B.C?

Mr. Thurtle: That does not arise out of the Question.

REGIONAL INFORMATION SERVICES.

Major-General Sir Alfred Knox: asked the Minister of Information whether he will give an estimate of the annual cost of the information services under the Regional Commissioners?

Mr. Thurtle: The present cost of the Ministry of Information's Regional organisation, including the salaries of the staff and the expenses relating to their activities, is estimated in round figures at £250,000 a year.

Mr. Lewis: What useful purpose are these services supposed to fulfil at the present time?

Mr. Thurtle: If the hon. Member were to go round the regions concerned, he would find that the opinion of the people there is that these regional officers are doing very valuable national work.

Sir A. Knox: asked the Minister of Information the number of officials employed by his Ministry in Information

services under the Regional Commissioners; and how many of them are of military age?

Mr. Thurtle: The total staff employed in the Regional Offices of the Ministry of Information is 366. Of these 231 are men of which number 123 are of military age, made up of 115 who are reserved under the current Schedule of Reservations, three who are medically unfit and five who are awaiting calling up.

Sir A. Knox: Could not some of these younger men be more usefully employed in the Services? At any rate they would do less harm there.

Mr. Thurtle: My hon. and gallant Friend will realise that the men he refers to are in reserved categories; therefore, even if they were engaged elsewhere, they would still be reserved.

Sir A. Knox: Why would they still be reserved?

Sir P. Hurd: Is it not a fact that the question of the reservation of these men has been brought under the report of Lord Rennet's Committee?

Mr. Thurtle: I could not answer that Question without notice.

CHIEF OF STAFFS COMMITTEE AND POLITICAL WARFARE EXECUTIVE.

Commander King-Hall: asked the Minister of Information what are the arrangements for the co-ordination of the work of the Chief of Staffs Committee and the work of the Political Warfare Executive?

Mr. Thurtle: The necessary arrangements have been made, but my hon. and gallant Friend will appreciate it would not be consistent with the national interest to disclose their nature.

Commander King-Hall: May I ask my hon. Friend if it is in the national interest to inform me whether, if the Chief of Staffs Committee are planning a military operation in one part of the world, the Political Warfare Executive sit with them and plan a political campaign in the same area and at the same time to fit in with the military operations?

Mr. Thurtle: I regret to say that I am unable to add to my original answer.

Commander King-Hall: In view of the unsatisfactory nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment.

ESCAPED FRENCH BOYS (PUBLICITY).

Mr. Keeling: asked the Minister of Information whether any steps were taken to prevent the British Press from publishing the Christian names, ages, relationships and portraits of the five boys who crossed the Channel to join the Free French forces, and from stating the part of occupied France from which they carried and whether he is aware that their parents or guardians are likely to be identified and punished?

Mr. Thurtle: Publicity in this case was only given after consultation with the Free French authorities in this country, who agreed that there was no objection to the publication of photographs of these boys.

Mr. Keeling: Did the Free French agree to the other four categories of particulars being published?

Mr. G. Strauss: May I ask whether the boys were consulted?

Mr. Thurtle: I am unable to say whether the Free French authorities agreed to the other particulars being published, but I do not think the boys themselves were consulted.

Mr. Keeling: Is my hon. Friend aware that this is a very serious matter, and will he take steps to see that this sort of thing does not happen again?

Mr. Thurtle: I will certainly draw the attention of my right hon. Friend to the observations made by my hon. Friend.

Mr. Thorne: Did the boys object to having their photos taken?

DOMINION TROOPS (PRIVATE HOSPITALITY).

Sir I. Albery: asked the Undersecretary of State for Dominion Affairs whether he is aware that many persons who would gladly extend hospitality to Dominion troops in this country are unable to do so on account of the food rationing regulations; and will he confer with the Minister of Food on this matter?

Mr. Whiteley: I have been asked to reply. I will certainly confer with my right hon. Friend the Minister of Food, but I feel bound to say that I see considerable difficulty in arranging for the exemption of any one section of the community from the operation of the food rationing regulations, even in the circumstances mentioned by my hon. Friend.

ELECTRICITY CHARGES.

Mr. Woodburn: asked the President of the Board of Trade whether he is aware of the hardship caused to old age pensioners and others living alone by the rule of the Stirlingshire and other electricity authorities that a minimum consumption must be paid for whether it is used or not; and whether some arrangement can be made for exempting those with incomes coming under the supervision of the Assistance Board and other Government inspectors?

The Parliamentary Secretary to the Board of Trade (Captain Waterhouse): The object of the minimum rent is to cover the standing charges of the undertakers in installing plant and fittings and maintaining them for use when required. The granting of exemption on the ground of income would be contrary to the provision of the Electricity (Supply) Acts which prohibit undertakers from showing preferential treatment.

Mr. Woodburn: Is the Minister aware that in certain areas old people living in houses where an electricity supply has been installed are still burning candles because they cannot afford to pay this minimum charge, and will he ask his right hon. Friend to look into this matter carefully to see whether it would not be possible to make some commonsense arrangement for people in receipt of low incomes?

Captain Waterhouse: I do not think it is the task of the Electricity Commissioners to look after the poor. I think Questions on this subject should be addressed to the Minister of Health.

BUSINESS OF THE HOUSE.

Mr. Lees-Smith: May I ask the Lord Privy Seal to state the Business of the House for the next Sitting Day?

The Lord Privy Seal (Mr. Attlee): It is necessary for the Royal Assent to be given without delay to the special Consolidated Fund Bill for the Vote of Credit. We shall, therefore, ask the House to pass the Bill through all its stages on the next Sitting Day at the beginning of Business so that it may be sent to another place for consideration. Afterwards the Adjournment will be moved and a Debate will take place on Food Distribution.

NEW MEMBERS SWORN.

Alexander Cadwallader Mainwaring Spearman, Esquire, for the County of York, North Riding (Scarborough and Whitby Division).

William Arthur Colegate, Esquire, for the County of Salop (The Wrekin Division).

BILLS PRESENTED.

PROLONGATION OF PARLIAMENT BILL,

"to extend the duration of the present Parliament," presented by the Prime Minister, supported by Mr. Attlee, Mr. Herbert Morrison, Sir Archibald Sinclair, Mr. T. Johnston, Mr. Ernest Brown, and the Attorney-General; to be read a Second time upon the next Sitting Day, and to be printed. [Bill 54.]

AGRICULTURE (MISCELLANEOUS PROVISIONS) BILL,

"to amend the Law relating to agriculture (including bee-keeping) and agricultural land," presented by Mr. R. S. Hudson, supported by Mr. T. Johnston, Captain Crookshank, Mr. T. Williams and Mr. Wedderburn; to be read a Second time upon the next Sitting Day and to be printed. [Bill 56.]

LOCAL ELECTIONS AND REGISTER OF ELECTORS (TEMPORARY PROVISIONS) (No. 2) BILL,

"to continue in force the Local Elections and Register of Electors (Temporary Provisions) Act, 1939, as amended by the Local Elections and Register of Electors (Temporary Provisions) Act, 1940, and to make certain amendments of those Acts, including amendments modifying the qualifications of common councilmen of the City of London and the persons entitled to vote at elections of aldermen and common councilmen in the said City and postponing the preparation of ward lists in the said City," presented by Mr. Herbert Morrison, supported by Mr. T. Johnston, the Attorney-General and the Lord Advocate; to be read a Second time upon the next Sitting Day, and to be printed. [Bill 55.]

Orders of the Day — SUPPLY.

REPORT [30th September].

SUPPLEMENTARY VOTE OF CREDIT, 1941.

EXPENDITURE ARISING OUT OF THE WAR.

Resolution reported:
That a Supplementary sum, not exceeding £1,000,000,000, be granted to His Majesty, towards defraying the expenses which may be incurred during the year ending on the 31st day of March, 1942, for general Navy, Army and Air Services and for the Ministry of Supply

in so far as specific provision is not made therefor by Parliament, for securing the public safety, the defence of the realm, the maintenance of public order and the efficient prosecution of the war, for maintaining supplies and services essential to the life of the community and generally for all expenses, beyond those provided for in the ordinary Grants of Parliament, arising out of the existence of a state of war.

Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."

The Chancellor of the Exchequer (Sir Kingsley Wood): Parliament has so far voted two Votes of Credit of £1,000,000,000 each in order that we may finance our war expenditure this year, and I am now asking for a further grant of £1,000,000,000.
The exact circumstances are these. On 27th September there remained about £146,000,000 unspent out of the last Vote, and that sum will last us nearly another two weeks. For the five weeks ended 27th September our expenditure from the Vote of Credit averaged some £78,000,000 a week, or just over £11,000,000 a day. Of that amount £9,000,000 was attributable to the Fighting Services and just over £2,000,000 to the miscellaneous group of other war services. When I asked for the last Vote of Credit in June we were spending about £10,250,000 a day out of the Vote of Credit, of which about £8,000,000 a day was for the Fighting Services. Our foreign expenditure, which had fallen between April and June, has recently increased again, but the increase represents only a small part of the total increase in Vote of Credit expenditure since June.
As I have explained previously, these Votes of Credit are available only for war services. When we include the service of the Debt and the Civil Votes, including those of our extensive social services, we are now spending in all some £13,000,000 a day. I often think it is not always easy to appreciate fully the extent and dimensions of such figures, but it is interesting to note that at the peak of our activities in the last war the Vote of Credit expenditure averaged about £7,000,000 a day and the total expenditure about £8,000,000 a day. At any rate, this can be said, whether we appreciate these figures or not, that our present expenditure has certainly involved and is involving heavy burdens upon and sacrifices by vast numbers of our people.
The further Vote for which I now ask will make a total for Votes of Credit of £3,000,000,000 during the year so far, and it should last, at the current rate of expenditure, until about the end of December. In my Budget speech I estimated that Votes of Credit for the year would require £3,500,000,000, apart from the sums required to pay for existing orders in the United States. I, of course, excluded also the value of supplies from the United States under the Lease-Lend Act. I did not try in my Budget speech to estimate the amount of payment to the United States under existing orders, because the amount was then uncertain, and, whatever it might be, it had no no effect upon the potentially inflationary gap. But, of course, it was always known that such payments would in fact be met out of the Votes of Credit, and, on the basis of the current figures, I anticipate that when a further Vote of Credit is taken, say in December, it will bring the total for the year, including the sums required for payments to the United States under existing orders, to a figure broadly in the region that I contemplated in April last.
If it turns out at the end of the year that, after deducting payments to the United States, the balance of Vote of Credit expenditure exceeds the figure that I named in the Budget speech, it will not follow even then that the excess will be of a potentially inflationary character. We shall first have to ascertain how far we have realised, and possibly surpassed, the Budget estimates of revenue, of savings and of expenditure financed out of the growing sterling balances of the Dominions and other countries. I am sure the House will appreciate that reviews of those factors can only be undertaken periodically and some time in arrear, but, from such indications as are available, I think we may say to-day that the object which I set before the country six months ago, that is, to finance the war by methods which would hold the dangers of inflation in check, has so far been achieved. The danger remains, however, and there can be no relaxation. There must, on the contrary, be an intensification of our efforts to meet those dangers.
I think it is well to-day to review the sources from which we have financed our expenditure during the first two years of the war. Our total expenditure in that

period was £7,018,000,000, of which £5,668,000,000 was on war services. Of the total expenditure we met out of current revenue £2,785,000,000, or 40 per cent. It is instructive to note that in the first two years of the last war our total expenditure was less than 40 per cent. of what it was in this war and that, even so, we then met less than a quarter of it out of revenue. I think this ought to be said, that the large sum that has been raised by taxation in this war is eloquent of the unprecedented efforts made by the taxpayer. In the early days of the war it was obviously necessary to allow time for adjustments required by the transition from peace to war, but four war Budgets, on top of the already exacting Budgets of the prewar rearmament period, has left the taxpayer in no doubt now of the sacrifices required and I think it should be said that those sacrifices have been willingly made.
There have been important additions to taxation in several spheres, but if I take Income Tax and Surtax alone, the additional taxation imposed by the first three war Budgets was estimated to yield £250,000,000 a year in all, while in the fourth Budget a further sum of the same amount was levied at one stroke. The total increase of £500,000,000 in these two taxes was about one and three-quarter times the whole of the Income Tax and Super-tax paid in 1918. With the combined taxation on the highest slice at the rate of 19s. 6d. in the £, it is clear that the maximum rate has been practically reached, at least in certain ranges of income. It is probably not realised that if we so increased taxation that no one was left with more than £1,000 a year or his present net income after taxation, whichever was the less—a course which would obviously precipitate very acute problems of many kinds—the additional yield would not exceed something of the order of £106,000,000.
At the same time I would like to say that in considering our future financial problem we must not overlook the dangers that lurk in unlimited recourse to borrowing, be the methods good, bad or indifferent.
In the last two years we had to find, in addition to the Budget deficits, nearly £150,000,000 for the repayment of debt in the hands of the public and other smaller capital payments, so that in all we had to raise, by means other than


revenue, no less than £4,380,000,000. Again, I would point out that figures of such magnitude such as these soon lose their reality, and I think it would be more informative if I referred in terms of percentages rather than of totals to the principal sources from which that sum of £4,380,000,000 was raised.
In the first place, 17 per cent. was covered by the realisation of our holdings of gold and foreign exchange and by borrowing balances on non-budgetary official funds such as the War Risks Insurance Funds and the Unemployment Fund. There is another striking figure. No less than 21 per cent. of the considerable total to which I have referred was provided by small savings—the net proceeds of National Savings Certificates, Defence Bonds, and deposits in the Post Office Savings Bank and Trustee Savings Banks. The achievement is not only very remarkable in itself but is a reminder to us all of how small sums, regularly saved by large numbers of people, can quickly amount to very impressive totals. I would remind the House that we are on the eve of seeing the gross total of small savings reach the notable landmark of £1,000,000,000.
There is another figure which I will give to the House. Subscriptions from non-official sources to medium and long-term market issues provided for 33 per cent. of our borrowings, and outstanding among such issues were National War Bonds which provided 19 per cent. out of the 33 per cent. I would say, and I think my hon. Friends will agree with me, that the practice of having war issues on tap has proved a notable success. Treasury Bills and Treasury Deposit Receipts taken up by the banks and other financial institutions provided 26 per cent. of our borrowings. The new system of borrowing from the banks by means of Treasury Deposit Receipts provided 12 per cent. out of the 26 per cent. and has amply fulfilled our expectations that it would prove to be a convenient innovation, though it must not be supposed that such short-term borrowings are, in any way, a substitute for borrowing as much as we possibly can direct from the public and for longer periods. I think we may regard it as a matter for satisfaction that no more than 26 per cent. of our borrowings has been achieved by additions to the Floating Debt in non-official hands. I would add one brief comment on our bor-

rowing programme. I have referred before to our cheap borrowing policy which has been so successful.

Mr. Stokes: Would the right hon. Gentleman explain to the House what he means by the word "non-official"?

Sir K. Wood: I will endeavour to give an interpretation if my hon. Friend desires it. I want, however, to add this further word to what I was saying. I have referred to our cheap borrowing policy, which, as I have said, has been so successful. It is of the utmost importance that we should not burden the country now, or after the war, with high interest charges. During the last war, the rate of interest on War Loans increased as the war went on until 5 per cent. and 6 per cent. were being paid. We have in this war not paid more than 3 per cent., even on the longest loans, and the House will have observed that each issue has been on terms more favourable to the Treasury than its predecessor.
No reference to the very large sums which we are spending on the war effort would be complete without a report on the progress made in the checking of extravagance and waste. On the last occasion on which I spoke, on the Second Reading of the Finance Bill, I described in some detail the arrangements which had been made to appoint a Director of Economy at the Ministry of Supply and to make analagous appointments at the War Office, the Air Ministry and the Ministry of Aircraft Production. These officers exercise general control over the economical use of materials and the salvage of material which has been used. This machinery has continued to develop, and I desire again to emphasise that every effort must continue to be made to instil in everyone the urgent need for the utmost economy. Since I last spoke we have had a further set of reports from the Select Committee on National Expenditure, which, I can assure the House, are taken into immediate and careful consideration by the Treasury and by the Departments to which they relate. Waste and extravagance in the wide sense of the term involve the uneconomic use of national resources, and while as Chancellor of the Exchequer I must normally concern myself mainly with the narrower task of seeing that Government money is not expended wastefully or extravagantly,


there are certain points at which the narrower and the wider tasks tend to converge.
One example of this arises in the case of cost-plus contracts, which have attracted a certain amount of attention both inside and outside the House. I should like to say a few words about this form of contract, because there seems to be a good deal of public misapprehension on the subject; in particular, there seems to be a belief that a large amount of work is being done for the Government on the cost-plus basis and that this necessarily causes waste.
It is important to distinguish between two kinds of cost-plus contracts—the one where the contractor is paid his reasonable cost, plus a percentage on the total, and the second where the contractor is paid his reasonable cost, plus a fee for profit, fixed in advance, which does not vary with the cost of the work. I do not hesitate to say that both forms are objectionable and are greatly disliked by contracting Departments as well as by most employers. The cost-plus-percentage type has been used during the war to only a very limited extent, usually for small, urgent building jobs where it was not possible to fix a price in advance or to operate a schedule of prices. I doubt, from the information that has been supplied to me, whether it is being used at all for production contracts.
The method of cost plus a fixed fee has been more widely used, especially during the early days of the war, on building work of great urgency. Given effective management, conscientious workmen and effective supervision, there is no reason why it should be more expensive than a fixed-price contract, but it does tend to give the impression to those employed on the job that cost does not matter, with consequent waste, not merely of money, but of labour, materials and perhaps time. Departments are doing their best to avoid it and with the increased standardisation of buildings and experience of costs it is becoming increasingly possible to let contracts at a fixed price.
As regards manufacturing contracts, it is difficult to avoid the use of this method in contracts for the repair of damaged articles and in the initial stages of manufacturing a new product or a

product which is new to the particular firm concerned, because of the impossibility of fixing a fair price in advance. This difficulty can, to some extent, be met by the method of introducing a maximum price in the contract. Under this system any costs over the maximum fall wholly on the contractor. This method, with various refinements, has been used over a wide range of manufactures. It is, however, admittedly less satisfactory than a fixed price, and I am glad to say that, with increased experience and the decline in the proportion of new types of products required, an increasing proportion of contracts is being let on fixed prices. For example, aircraft contracts are to a very large extent let on a fixed-price basis. I do not mind confessing that I wish it were possible for the Government, by a stroke of the pen or the issue of a simple direction, to secure that all contracts should be let at a fixed price. This ideal is, I am afraid, impossible of attainment, but the House will be glad to be assured that all Departments are fully alive to the objections to the other types of contract which I have mentioned, that their use is diminishing and that the fears that there exists here a large area of avoidable extravagance are not justified by the facts.
Let me say a word about the future. On the whole, it seems to me that there are good grounds for satisfaction in our financing of the first two years of the war. What of the future? We have to steer a middle course between excessive pessimism and excessive optimism. Resolution, self-denial and confidence must continue to be our watchwords. Certainly we must not let the task of financing ourselves for this tremendous war dismay us. Given the will to deny ourselves in the cause of victory, which we assuredly must possess, the task is clearly not beyond our resources if we make wise use of them.
I have seen it suggested that in the process of financing the war the country is rapidly "bleeding to death" and that we have practically exhausted our ability to finance the war on sound lines. Such gloom and despondency are thoroughly harmful, and are based on a quite fantastic view of our position which has no relation to the realities of production and finance. To give one example, the increase in money incomes that arises from our large war expenditure itself helps to provide and will continue to help to provide


one source from which we can finance the war. The danger for the future will not lie in any automatic drying-up of those incomes but in the faltering of the resolution to restrict the spending of them. It is clear that the vision of our alarmist is still limited by peace-time considerations and that
the native hue of resolution
Is sicklied o'er with the pale cast of thought.
I firmly believe that he will find no response in the country as a whole and that our people have the same quiet confidence in the financial as in the military future of the war.
In all these considerations it is right that I should also utter a special note of warning. Not many days go by without some plans or projects being canvassed for some immediate appreciable increase of Government expenditure. Nobody is more glad than I am that we have been able, for instance, not merely to maintain our peace-time social services unimpaired during these difficult times, but even to add new services in order to minimise the inroads which war must necessarily make on our standards of life. All new permanent projects and schemes involve, however, permanent increases of annual expenditure. It it not uncommon to hear the annual cost of each particular scheme belittled by comparison with the cost of so many days of war. The two things are, of course, in no way comparable. The war is being financed by borrowing, the burden of which after the war will be very heavy, but permanent annual expenditure will have to be met by taxation.
We may well have to face a long war, and clearly the longer the war continues and the more expensive it becomes the greater will be the efforts required to maintain the soundness of our financial position and to husband our financial strength to meet whatever further demands the war may make upon us. Certainly it means that everyone must realise the need for strict economy, still more rigorous restriction of private expenditure, still greater saving and still freer lending to the State.
All that is true, whether we are thinking of the immediate future or the post-war future. Our immediate object is to win the battle of this year's Budget and to see that our current war expenditure is not allowed to generate active inflation; and as to that an intensive and immediate

effort to recapture the upward swing of saving which was in progress before the recent holiday season is vital. As regards the post-war future, a moment's reflection will show that peace will bring its own difficult financial problems and that we shall make it easier to face those problems if we continue to finance our huge war expenditure on sound lines. The size and form and cost of our war debt will clearly have an important influence on our postwar policy. It is even more important to realise that we shall undoubtedly be gravely hampered in dealing with postwar reconstruction and development if we have to embark upon them under conditions of inflation. I know that I shall have the assistance of Members of the House in bringing home to our people the plain and vital fact that by refraining from spending, and by saving and lending now to the utmost, we shall not only keep our war effort firm and strong but also help to attain the equally desirable object which animates us all, that of laying a sure and firm foundation for the advancement and progress of our people after the coming of peace.

Mr. Stokes: Before the Chancellor of the Exchequer sits down will he kindly explain what he meant by the term ''non-official sources"?

Sir K. Wood: Banks and financial institutions, etc.

Mr. Pethick-Lawrence: It needs few words of mine to commend to the House the Vote which we have to take to-day, which has been so ably expounded by my right hon. Friend the Chancellor of the Exchequer. Perhaps I may be permitted to say a few words at the beginning on the two topics which formed the latter part of the Chancellor's speech. On the question of the form of war contract, I commend the guarded words which the Chancellor put forward on that subject. As Chairman of the Public Accounts Committee I may say that we have devoted during this Session a considerable part of our labours to the consideration of this very vital matter, and though our investigation has necessarily been of a retrospective character I am prepared to endorse for the most part what the Chancellor of the Exchequer has said. I think everyone will agree that a cost contract, even when it has added to it only a fixed profit basis,


is not an ideal form of contract; but, equally, those who have studied this matter must have realised that in some cases some such form of contract is quite unavoidable.
Let me put this simple case. It is easy when you are buying a bicycle to have a fixed price, because of the many firms which make bicycles and the many shops which sell them, and one price can be set against the other to get a figure based upon a competitive deal; but when the Government are asking a manufacturer to produce an article which has never been produced before, say an aeroplane to a new specification, or a gun to a new specification, it stands to reason that neither of the parties concerned, the Government or the contractor, can have a definite idea of what the cost ought to be. Then it is absolutely necessary, however undesirable it may be in general principle, to base the contract upon the cost actually incurred, and the only thing which can be done in those cases is to safeguard the public purse by all possible means. I honestly believe, as the result of the detailed investigations we have carried out, in so far as the year under review is concerned, that in the great majority of cases those safeguards have been carefully applied.
The great safeguard which we now have but which we did not have before the war began is the power of the Department to send its own costing accountants to examine the accounts of the contracting firm after the event. Now that the books are compulsorily opened, if required, to the costing accountants of the department, there is a safeguard to the public purse in that fact. Those costing accountants are able not merely to check up what has actually been spent by the firm, but, from their knowledge of processes, they are able to check whether the amount spent upon a particular process ought to have been spent, or whether there has been a large margin of wasteful extravagance. Even in the year under review cases were brought to our notice in which sums which had actually been spent by the contractors were not allowed as legitimate expenditure because the accountants showed that the expenditure ought not to have been incurred. I therefore say, while guarding my words, as I think the Chancellor himself was guarded in what he said, that

though this form of contract is certainly not ideal it is, in certain cases, unavoidable, and, allowing for human errors, in the great proportion of cases the public purse is being safeguarded by the precautions on which this House has insisted and which are carried out by the Departments concerned.
With regard to the point made later by the Chancellor of the Exchequer, I agree that people who base their view of the effect of the financial expenditure of the country upon narrow and old-fashioned ideas of finance are unjustified. So long as the great productive resources of this country remain, there is no question of this country being bled white and there is every prospect that, for the remainder of the war, whether the war should last a long time or, as we all hope, a comparatively short time, the resources in this country will be sufficient to meet the expenditure, and that, when the war is over, there will be means of production left which ought to give not merely an income in the country equal with the income before the war but a greater income, from which a nobler country can be built up.
I agree with the Chancellor of the Exchequer that recurring expenditure is not of the same kind, and cannot be put into the same category, as expenditure for war. I would add that recurring expenditure which promotes the prosperity of the nation and the well-being of the people, and thereby fits people for greater efforts of production in the future, is in many ways more provident, and more possible to be carried through, than expenditure, however necessary, for the destructive purposes of war.
Having dealt with the two points to which the Chancellor of the Exchequer referred in the Debate, I return to the subject proper of the Vote itself. As the right hon. Gentleman stated, this is the third £1,000,000,000 that this House has been asked to vote during the present financial year. That means that we have, in the first six months of the year, already spent close on £2,000,000,000 on war purposes alone. The expenditure would have been greater but for the generous provision made by the United States in the Lease-Lend legislation. I would like to carry the point one stage farther, by adding the ordinary expenditure of the State, on top of the purely


military expenditure. If that expenditure is taken into account, the total expenditure in the first six months of this year has been very close to £2,250,000,000. Of that sum, nearly £750,000,000 has been covered by taxation revenue, leaving something like £1,500,000,000 to be borrowed in one form or another. I would remind the House that the first six months of the financial year are not the best for tax collection and that therefore we need not form a gloomy prognostication that the second six months will show as small a proportion of expenditure met by taxation as has been the case in the first part of the year. On the other hand, the Chancellor of the Exchequer indicated that the total expenditure was likely to be more in the second six months—as, indeed, it nearly always has been during the war—than in the first six months. Therefore, we shall certainly see a total expenditure in excess of £4,500,000,000, and it may run up to nearly £5,000,000,000, for the whole of the financial year. I do not know exactly what proportion this sum bears to the total income of the people of the country, but I imagine that it is well in excess of half that total income. Perhaps it approaches to two-thirds.
These being the facts, I congratulate the Chancellor of the Exchequer that this is the first war year in which he has not had to introduce a second Budget. The first Budget introduced by his predecessor had to be supplemented by a second Budget. In the second year of the war there had again to be a second Budget, because the provision made earlier in the year had been inadequate to meet the situation. This year, the courage of the Chancellor of the Exchequer, stimulated by the vigorous attitude of this House representing the people of the country, has enabled us to have a Budget which, as far as we can see, will not require to be supplemented during the present financial year.
We pay tribute to the people of this country that, in spite of the unprecedented burdens that have been put upon them, these burdens have been accepted, on the whole, by all sections of our population without demur. I constantly find in my postbag letters from people who have written to me about grievances, but very few letters refer to difficulties imposed by taxation, in spite of the fact

that very heavy sacrifices are in many cases making things most difficult for the people upon whom they have been placed. My belief is that the people of this country are more resolute to-day, if that be possible, than they have been in any previous stage of the war. Taking a broad view of the matter and looking round the country, I see no sign whatever of complacency or of easing-off in the war effort. Of course, nerves get frayed and muscles get tired, but, broadly speaking, so far from there being any easing off, I see a growing determination to prosecute this war to a successful conclusion.
The critical factor to-day is that the situation has been changed; the determination of Herr Hitler to pursue the war on the East as well as on the West has brought the great Republic of the East into the conflict on our side. Last year our country, as the Prime Minister said yesterday, was standing practically alone, and the whole brunt of the cruel German war machine was falling upon the people of this Island. We were bearing that burden with the traditional courage and tenacity of our people. To-day, the main direct burden of the war has been shifted to Russia. The Russian people met the shock, as everyone has realised, with exceptional fortitude and courage, and they are carrying out, not merely in the fields but on the farms and in the cities, that terribly sacrificial policy of the scorched earth which will make the most difficult tasks that it is possible to imagine for the invader. We must, I think, pay a tribute in passing to the fortitude with which that sacrificial policy has been carried out.
Our people, with their genius for grasping the essentials of the situation, have seen that it is necessary to sustain Russia by every means in their power. During the Recess I had the interesting experience of talking with a man who was in Russia during the early period of the revolution, when he came into contact with many people who were then or have since become leading figures. Incidentally he told me that he had formed a very high opinion of the capacity of General Timo-shenko. He also told me that he was present at an interview between Lenin and Trotsky when the terms of the Brest-Litovsk Treaty were first proposed. Trotsky said that it was incompatible with the honour of Russia, and Lenin replied, "But the soldiers have voted for it." "Voted," said Trotsky, "what do you


mean by that? They have not had any ballot papers in their hands, and they have had no opportunity of giving a vote." Lenin said to him, "My friend, you do not realise that people can vote with other things than ballot papers. They have voted for it with their feet." By which he meant, of course, that the soldiers had retreated and had decided that, in the absence of munitions, they were not prepared to stand and face the Germans any longer. I would say that our people have voted, to-day, with their muscles, for the greatest help to be given to Russia, who is bearing the brunt of battle at the present time.
However long this struggle may last, our people will vote with their muscles as well as with their financial resources for the utmost support for that part of the front where the battle rages. And when the struggle comes to an end they will vote, with their ballot papers it may be, for the creation of a nobler Britain in which there shall be a greater chance for all sections of the population than existed before the war. Our vote to-day will be an expression of that wide feeling of determination which prevails throughout the country. I feel confident that our vote will be unanimous, and will thus be symbolic of the unanimity of this nation. For many years I have taken an active interest in political life. I have seen other wars in which this country has been engaged, but never in my life have I felt the solid, determined unity of our people as I feel it to-day. Never before in our history have the whole of the English, Welsh and Scottish peoples been so conscious of their unity, nor so filled with a common purpose to which they are prepared to dedicate their lives. It is as representing this strong, resolute and determined British people, here and all over the world, that I ask this House to support the Vote of Credit for which the Chancellor of the Exchequer has asked.

Mr. Graham White: If any Member of the House to-day is inclined to criticise any of the observations made by my right hon. Friend, they would not be those sentences in which he said that it was becoming exceedingly difficult to appreciate the full meaning and scope of the gigantic figures, and the magnitude of the scale, on which our national finances are now based. It cer-

tainly is difficult to realise them and to understand the full consequences. Like my right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence), I have no doubt that this House will unanimously support this Vote of Credit, nor do I doubt that it would have done the same had the Vote been even larger than it is, provided always that hon. Members are satisfied that the money is being devoted to the prosecution of the war and that every conceivable step is being taken to avoid wasteful expenditure.
I entirely agree with what has been said about the spirit of our people, their unanimity and their determination to make every conceivable effort. At the same time there is among them a tendency to be increasingly impatient with any evidence of waste or apparent waste which does come to light. I have had evidence of that feeling in my correspondence recently, which has indicated some criticism of the great display which is being made in the popular Press at the present time regarding some of the frills and fripperies of the trimmings of the war, such as new uniforms, new hats and new badges. It is a spirit of display which had a culminating point in one of the papers when, in great headlines, it said that Mr. Churchill was to choose the slacks for the A.T.S. I would venture to say that that kind of thing had better stop. It is having some effect upon the War Savings Movement, and it is not worthy of the kind of enterprise which we are engaged in at present.
I heard with satisfaction the statement made by my right hon. Friend the Chancellor of the Exchequer about the terms of contracts and the Select Committee on National Expenditure. It is true that there is no reason why the House of Commons should, even if it could, devote itself to a meticulous examination of estimates in these days. But it had ceased to do that before the war, owing to the pressure of business. The House of Commons, which, in Gladstone's day, was custodian of the public purse, was custodian no longer. Nor could it be; neither, in any circumstances which we can envisage, is it ever likely to be again. It is, however, an interesting constitutional fact that the House of Commons, by setting up the Select Committee on National Expenditure—which is undoubtedly doing very valuable work, with the co-operation of the Departments—has devised for itself


a means of assuming in some degree the custodianship of the public purse, and has in fact got greater power of examination, suggestion and control than it ever had before. I sincerely hope that in our postwar arrangements we shall contemplate the possibility of maintaining, either in its present or some other form, some Committee system which will enable the House to maintain its wholly salutary influence on the course of public finance. In war time it is very important, all the more so because of the fact that for many reasons the control of the Treasury itself over our finances cannot be precisely the same as it was in peace time. I welcome the Chancellor's statement about the cost-plus-profit form of contract. We hope that that form of contract will become a rare exception in our finances.
I was glad, on the widest possible grounds, that the Chancellor saw fit to refer to some of the criticisms which have been made regarding the possible course of our finances after the war. If there is anything which is more likely to make our financial situation after the war more difficult, it is the kind of prognostications being made at the present time. In particular, I think the Chancellor must have in mind a publication by a distinguished citizen, who has had a distinguished career which entities him to respect and a wider hearing, but not a career which has necessarily been closely associated with finance or economics. I think it is well that statements of that kind should be subjected to some little examination, and I am glad that the Chancellor availed himself of this opportunity to refer to them. It is stated in this publication:
We must face the fact that the war is rapidly bleeding us to death. After this year it will be impossible to finance this war either by taxation or by new borrowing. The war is consuming by far the greater part of the aggregate income of the population. The only course open to the Government will be the printing of worthless banknotes or some other way of repudiating our national obligations.
I think it would not be unjust to say that that statement, in the main, is just nonsense.
The war is consuming by far the greater part of the aggregate income of the population.
Actually the reverse is the case. As long as the war continues, and expenditure continues on the present scale, the aggregate incomes of the people are increasing. There seem to be some people who take the view that there is some

economic law in connection with war that it must inevitably be followed by impoverishment or poverty. That is not the case. There is no such law. What will happen to our finances after the war will depend on the common sense we apply to our problems and the scale with which we deal with them. If it was said that there was fear as to the financial and economic position of Europe and the world because of the fear lest it might not be possible to secure a reasonable political situation in Europe, that would be a ground for fear. Therefore, those who take the gloomy views with regard to finance ought, in the first instance, to devote their energies to the sphere in which they are better able to deal in trying to ensure the first condition of a reasonable peace, namely, that an atmosphere and attitude of mind throughout the world to enable a proper peace to be made shall be ensured.
What happened after the last war? It was not followed by an immense onrush of poverty. It was followed by a boom. That boom got out of hand; it was ill managed; it was not controlled. The result was that disaster ensued, as it always does. Then we rushed into the period of over-production because the world refused to deal with the problems of production and distribution, and it is in that field that will be determined the course of our after-war finances and success. There is nothing in the scale of our transactions so far which means that they should bring us anywhere near the miserable condition forecast in this nonsensical statement that I have read. We have got to remember that the only thing which would prevent a recovery after this war would be the destruction of the means of production in our own land. Provided that they are left to us and we guide ourselves with prudence and courage, there is no situation in which we cannot build up a reasonable and, indeed, a higher standard of life in this country than we have had up to the present time.
These are the facts of the situation as I see them, that we should devote ourselves to considering how we are to produce that condition when peace comes. I consider that the scale of our finances is not one which will compel us or drive us into conditions of great difficulty. I am glad that the Chancellor has been able to give us a reassuring statement with regard to the fulfilment of what he laid before us when he unfolded his Budget. There is


no reason, I am glad to know, that we should have an emergency Budget and no reason to think that, within the substantial margin of error which is inevitable in wartime, his forecast should not be reasonably accurate. He forecast, I think, that there would be this year an increase in expenditure owing to production of £500,000,000. That is the important thing the House wishes to see. If the war were to go on for the same period as the last war, with the same progressive increase in the National Debt, we should find ourselves at the end of four and a half years with a National Debt of the order of £10,000,000,000. But when critics and those people who think they can deal with the future by mobilising the ghosts of the past compare our present situation with that of the last war, they forget that we have learned a good deal since then about finance.
In the last war we paid, as the Chancellor of the Exchequer told us, up to 6 per cent. for our Debt. He is much more niggardly, as a borrower, than the financiers of the Soviet Republic, who I understand are paying 4 per cent. at the present time, with some additional speculative attractions. If the Chancellor is niggardly as a borrower, he is rendering a tremendous service to the State, because if the increase in the National Debt in the first two years of the war is something like 60 per cent. of the increase incurred in the war of 1914–1918, the actual increase in the burden of interest is not more than 30 per cent. That is what is overlooked by many of the critics and many of the people who so readily don the mantle of Cassandra. They also omit to observe that the interest on Government loans is paid subject to tax, and is, later on, subject to Supertax, so the average rate of interest, the net burden on the State on the whole of that Debt, is unlikely to be more than 1¼ per cent. Therefore—again we are in the realms of speculation, but one estimate in these matters is as good as another—the total interest burden of this war, if it lasted for four years and the debt increased in the ratio I have suggested, would be of the order of £125,000,000 to £150,000,000 additional expenditure. I have mentioned this because of the gloomy speculations which serve no useful purpose, and which perhaps

interfere with the War Savings Movement and add to the difficulties against which we shall have to struggle at the end of the war. It is unnecessary for me to add any word to invite support for this Vote, because I am sure that it will have the entire support of hon. Members.

Mr. Lewis: There is one point upon which I should like to secure a very definite assurance from my right hon. Friend the Chancellor of the Exchequer. When the war is over we shall be faced with financial problems of immense magnitude and complexity, arising from the great increase in the National Debt. My hon. Friend the Member for East Birken-head (Mr. Graham White) pointed out, I thought very truly, that the extent of the burden will depend upon the common sense and skill which we direct to its solution. I am anxious that there shall be no doubt that when the time comes we shall be perfectly free to apply all our common sense and skill to the solution of those problems. Above all, I am extremely anxious that the Treasury and the banking authorities in this country shall be free to apply their unrivalled skill and experience to the consideration of those problems. At present, our relations with the United States of America are of a very nebulous character. The Government are in close touch with the Government of the United States and we are not told much of the negotiations that go on between them. Nobody complains about that, because of the obvious importance of preventing our enemies knowing what the two Governments are planning. But I have wondered whether anything has been said about the financial problems which will arise after the war, and, in particular, whether any engagements have been entered into, or are being contemplated.
The assurance that I hope to get is a perfectly plain and categorical one. It is, that the Government have not agreed and are not contemplating agreeing to any arrangement with the United States which would tie sterling either to gold or to the American dollar. I cannot see that our war interests can be damaged by a disclosure on that point. I do not wish it to be thought that I have any but the friendliest feelings towards the United States or that I wish to suggest that after the war we should pursue any policy but one of close collaboration with them, in


finance or in other ways. But Americans have the peculiarity that they are generous givers but very hard bargainers. If you ask them for a gift, you will probably get a magnificent one; if you go to them to discuss a bargain, you are certain to have a very hard bargain. I can foresee that if we are so foolish now as to enter into any commitments about the future of sterling with regard to gold or with regard to the dollar, that might prove a most awkward obstacle in any subsequent negotiations with the United States. With that characteristic of hard bargaining they might, even though it were against their own interests, allow that to become a great obstacle to us. I do not wish to suggest whether, at some time in the remote future, there may be some definite relation between sterling and gold, but I am certain that the experiences resulting from our mistaken return to the gold standard after the last war show the great danger of being too precipitate in these matters. I am for the moment concerned only to secure that when the vital time comes we may have our hands entirely free to act, as my hon. Friend the Member for East Birkenhead said, with common sense and skill in these matters. Seeing that the Chancellor is not in the Chamber, I hope that the Financial Secretary, if he cannot give the assurance himself, will communicate with the Chancellor about the matter.

Mr. Woodburn: The Chancellor to-day has the enormous task of trying to adjust the book-keeping of this nation to the enormous material contributions that our people are making to the war. It is a great mistake, in my opinion, for people to make extravagant statements about this country bleeding to death. This country, instead of bleeding to death, has enormously increased its production, and has risen to the occasions and is producing almost all the material required for the prosecution of the greatest war that has ever occurred. The money question is the shadow, but the material contribution is the substance. Therefore, the question of whether we are bleeding to death is not one of counters, or of money, but of whether the country is able to feed its population, and whether that population is able to work and to produce the materials required for ourselves and our Allies, and whether at the end we are

going to be so impoverished that we cannot continue to live as we did heretofore.
Examining the matter from that point of view, I think some people are much too gloomy. This country is, to all intents and purposes, now a great nationalised industry. We have co-ordinated the activities of all our people, and have mobilised them by raising the necessary money from the public and from the banks and other institutions to enlarge our business. That money is not all lost; much of it has been spent upon capital assets. I myself have seen great quantities of some of the finest machinery in the world brought into this country from abroad, and, unless we are very unlucky, it will remain after the war. Our people have not lost their skill. On the contrary, large numbers of our people have been trained to a degree of skill that was never reached before in our history. Therefore, in view of all the machinery and the material that we have created, except that which has been destroyed in the war, and the skilled personnel that will exist in this country after the war, our capacity for future production will not have been decreased but enormously increased. Far from having to look forward to a time of poverty and destitution after the war, we can look forward to a great period of development for the benefit of the people of this country.
It is true that, in money terms, that effort cannot be measured in the money incomes of pre-war. Assume that the income of this nation, that is, the work done by this nation, amounted to £4,000,000,000 a year, we have brought in 1,000,000 unemployed and a million or two of married women and women who did not previously work in industry, and also another 1,000,000 who did useless work—because many people do useless work from the production point of view— and have therefore increased our workmanship by 4,000,000. Some, of course, have taken the place of men in the Army, but there is no question that the man-working hours in this country have doubled if not trebled since the war began. Therefore, if a third of the existing war effort be measured in terms of the £4,000,000,000, you cannot measure the present effort within the realm of your £4,000,000,000. Therefore, the Government and the State have to expand money terms in order to cover this greatly


expanded effort, and instead of that being something to be deplored, we ought to rejoice that the country has been able to reach that development in the struggle that we have to face.
One or two points arise in regard to the working of this great effort. Are we wasting any of that expenditure? Are we expending any energy on the production of the war material that can be eliminated. As the hon. Member for Colchester (Mr. Lewis) said, this House set up a Committee on National Expenditure, of which I am privileged to be a member. It has been our duty in the course of the last two years to examine into the question of waste. We very soon found that any number of contracts were being placed on conditions that led to great waste. People were given permission carte blanche to go ahead and get the job done no matter what it cost or what was wasted. Now that could easily be condemned if the circumstances made it possible to do otherwise, but the Select Committee were faced with the choice of whether it was a greater importance to wait for three or six months and check tenders before starting to build barracks and buildings to hold soldiers and the Army that we were creating, and perhaps, by delaying the creation of the Army, risk the loss of 1,000,000 lives, or to go ahead and risk the loss of £1,000,000. If it comes to a question of economy and waste as between lives and money, this House of Commons can never say that it will risk lives in order to save a little money. Therefore, faced with that situation, we recognised, as my right hon. Friend said, that the Government had to go ahead with the job and take the risk of losing money. It is true also that in many cases where you are asking any firm to make goods it had never made before, you have to allow for that firm learning the work and take the risk of its wasting money in experimenting and in building up its plant. These were all growing pains through which we had to go in the transition from our peace industry to war industry.
But I think the Chancellor of the Exchequer is mistaken in thinking that there are not many contracts placed on the cost-plus basis. There are a great many varieties of contract. He mentioned two of them. He mentioned

reasonable cost plus a percentage and reasonable cost plus a fee. But there is also unreasonable cost plus a percentage, and there may be unreasonable cost plus a fee. It is certain that many of the contracts placed in this way have been utilised not for the purpose of getting the job done, but for building up great octopus concerns which are using the contracts not only for the production of the goods required, but for the purpose of swamping their competitors. One of my hon. Friends has mentioned the case of Wimpey's. This firm has become a perfect scandal in Scotland, and indeed, I believe, in some parts of England, where this firm has not only been able to get contracts from every Department of the Government but has been able to get them on such terms that it can go to its competitors and buy up their plant and machinery and practically absorb their businesses. It is with great difficulty that any investigation can be made into this matter, and it is only after the greatest difficulty that the source of it can be traced. Nothing is causing greater bitterness and loss of morale in Scotland than a large number of firms seeing that a firm, which has no place in Scotland and has done no work there, and which, I understand, was a very small organisation before the war, has in the course of the war become so big that practically no other firm in this country has a chance of a contract with certain of the Ministries.

Mr. Stokes: Would my hon. Friend explain to the House whether Wimpey's contract was really such as enabled them to buy up the plant of their competitors, or to obtain the use of their plant at excessively high charges, because that is a very different thing?

Mr. Woodburn: They are doing both. The ordinary man in the street or the ordinary contractor who sees that going on comes to the conclusion, rightly or wrongly, that the firm of Wimpey must be able to get whatever money they require from the Government to build up their business, and they think that there is something more than meets the eye in it, and that it requires investigation. My hon. Friend the Member for Maryhill (Mr. Davidson) is pursuing the matter in another direction. That is what I say would be an unreasonable cost plus a percentage.
There are other cases where there are target costs, which is another method by which skilled estimators in the Government reach what should presumably be the cost of an article, and they offer the contract to a firm at that target cost. If the firm take more to produce it, the firm lose, and if they take less to produce it, then they get less and the Treasury benefit. That is a contract which I describe as "heads the firm lose, and tails the Treasury wins." All the contracts have certainly not been placed for the benefit of the firms getting them. Many of the firms, knowing that they cannot make excess profits, do not think that it is very material to ask for a higher price. There are other contracts at fixed prices, and contracts where a fixed price is given subject to costing, and even if a fixed price is given, the contract is still costed and the firm may get less. These varieties of cost have all been introduced in a very earnest endeavour of the departments, I am convinced, to try and limit as far as possible uncontrolled spending on the part of any Government Department, and I must pay tribute to the improvement and the development of the costing system.
At first the costing system of the Government Departments was post-contract costing. Long after the contract was finished they started to cost it. But when thousands of contracts were placed per week it became fantastic to think that you could find enough costing people in the country to go round costing these contracts. Now they have adopted a much more effective method—spot costing—by which they go to a firm, check up in the midst of its work and find out what is its efficiency while the job is going on. But there are some contracts, in engineering particularly, which are still very regrettable. I have an instance in my mind which has now been submitted to the Select Committee, and which they are now examining, but as I know of it outside my membership of the Committee I am at liberty to mention it in the House. This firm—a great motor organisation linked up with an important national rail-way—has been able to get contracts from the Air Department and stack up its works with something like £60,000 worth of machinery which has not yet produced one part for an aeroplane. This firm has been paid all these costs and the cost of keeping men standing idle for weeks be-

tween different contracts and cancellation, and at the end of it they will, presumably, be in the possession of some of the finest machinery in the country which has never yet produced an article for the war.
Slackness in this matter is not confined to this firm alone. It is having a detrimental effect on morale and on firms and men in the vicinity who have protested at the way in which this firm can get away with this sort of thing while they are being costed up to the last halfpenny. On the Clyde and in the East of Scotland there is discontent about the fact that certain firms have been able, and are able, to spend as much as they like without any check. It is difficult to get to the bottom of the matter and to tie them down to specific instances. Men say, "These firms can spend what they like. Why should we refrain from asking for rises in wages when they can pour out money for no work?"

Mr. Stokes: Does that mean spending money on plant and development?

Mr. Woodburn: No. A firm says, in effect, to its men, "It does not matter whether you are doing anything or not. We keep on paying you. "One firm, in the early part of the war, had agents in public-houses offering any wages in order to get skilled engineers from key trades to go to this particular firm. Even some of our Royal Ordnance factories were subject to that kind of treatment. I want to say quite frankly that the Department and the Treasury have done everything they possibly can to try and put a check on this wasteful expenditure, but to a large extent we must depend on the good will and conscience of the people in industry. In some cases these have been lacking, and it is very regrettable. The cost-plus system has also had a reaction on the willingness of workers to pay Income Tax. I have had a letter from a miners' executive in my area who knows a good deal about economics as well as mining. He states that miners are now receiving their claims for Income Tax, and he warns me that the feeling among miners is such that production is likely to suffer by miners being disinclined to work overtime and long hours when it appears to them that they will get practically nothing for it. I quite recognise that theoretically people ought to work overtime for patriotic reasons, but unfortunately when men


work 60 or 70 hours a week in the pit it takes more than that to induce them to work extra hours.
This is a deficient way in the long run of collecting this Income Tax. I have raised the question with the Chancellor, who has said that he finds practical difficulty in the way of taking money from workers when they earn it, but if it cannot be collected when a man earns high wages it will lead to trouble when he has to meet retrospective collection. I urge the Financial Secretary to put before the Department and his right hon. Friend the necessity of finding some method of deducting the tax from wages at the time the worker gets the wages and not leaving it to be deducted at a time when perhaps his wages have fallen. My friend the mining executive, therefore, makes these two suggestions: (1) that the Chancellor should find some method of making de-deductions from wages when they are earned; (2), that a larger proportion of the Income Tax that is deducted should go to national savings for post-war spending. If the miner was convinced that he would not sink into poverty after the war, he would not feel this handicap of working, as he feels, for nothing. I hope the Chancellor will give serious consideration to the suggestions. He might reply, I know, that taxation at the rate of 19s. 6d. in the £ is a tremendous drain on the people with the top incomes and those at Surtax levels. I agree, but may I submit to him and the Financial Secretary that after all the question of income and consumption is one of using up the products and labour of the nation? The country to-day is restricting consumption of that to a very small degree of necessaries, and, therefore, no amount of allocation of money would increase the possibility of consuming goods or labour.
So in this country to-day it is clear that the use of labour and consumption is restricted in that it is being allocated more and more according to some reasonable basis of rationing. In discussing the allocation or distribution of incomes, it is not a question of allocating existing incomes but a question of distributing incomes after the war, A person paying 19s. 6d. in the £ is not starving to-day because he has a very large amount of capital. Some Members of the House say they are living on their

capital. I do not assume that prior to the war these people were living up tc the last halfpenny of their incomes. It can be assumed that for four years before the war they were increasing their capital by abstentions and saving, and all they are doing by living on their capital now is to go back to the position they were in four years before the war. They are no poorer now than they were in 1935. So far as they are concerned, they are using some of the savings they had. They are the people whose postwar incomes are being raised by the transfer of their capital to pay people who are producing goods to-day. They will be able to consume only after the war. Therefore, we are at this time in the midst of a very considerable redistribution of income which will be applicable after the war. I suggest to the Government that if a further redistribution of income would help production and give a greater feeling of fair play as between man and man in the country, it would be to the benefit of the war effort, and even those people having large incomes would not suffer.
I congratulate the Chancellor on the general working of his financial policy. I do not think the Government's policy has been tending towards inflation; I believe we have taken the most effective steps possible against inflation. When we think of 3 per cent. interest, we have to keep in mind the fact that in normal cases 10s. in the £ is immediately deducted from it, so that the person concerned gets 1½ per cent. interest on his money, and this, compared with former days, seems a fantastic way of financing the war. Even in respect of the 1 per cent. of the banks, if any of it were profit it would be subject to ½ per cent., and it is questionable whether the 1 per cent. does more than meet the cost of running the banks. The only question is whether, if the banks make excess profits, the Treasury keep a very tight hand on them and see that the whole 100 per cent. is obtained for the Treasury.
The final point I want to make is this. No matter how many financial investigations there may be, it is a physical impossibility to check and cost everything that is taking place at the present time, and therefore, we have to rely to a large extent on the honesty and integrity of those who are running industry and those who are working in it. From my experience in the Select Committee, I say


that, while there may be cases of inefficiency and hitches in production, the great majority of the firms in this country and the great majority of the workers are working to 1oo per cent. of their practical capacity. That does not mean 1oo per cent. of their theoretical capacity, which is an entirely different thing. We are dealing with an industrial army of nearly 20,000,000 people. Anybody who has had anything to do with organising an army on the Continent will know quite well that some regiments will get out of step. The greatest general in the world cannot guarantee that all regiments will be at the same place at the same time ready for the battle. Equally, it is impossible with an industrial army, especially when communications may be bombed and valuable machine tools sunk, to ensure that production will not be very often interrupted by unforeseen events. All I say in this connection is that when these hold-ups are unavoidable, some explanation ought to be given to the workers in order that they may understand that the hold-ups are not due to inefficiency on the part of the Government or the management. Much of the discontent and irritation among the workers is caused by the fact that they receive no explanations. In the mining and shipbuilding industries especially, the employers still appear to treat the workers as though they were not civilised beings capable of understanding a simple explanation. From the point of view of efficiency and economy, a greater effort to take the workers into confidence would be beneficial to the nation and the war effort.
There has been a great deal of exaggeration concerning slackness in industry. I believe that the overwhelming number of the workers of this country are anxious to work as hard as possible in the national effort. I have come across a great many instances where, quite obviously, there have been no vested interests, no greed and no cupidity in connection with the efforts being made and where those concerned have been patriotic and prepared to leave all other matters until after the war. It is true, however, that we have not yet reached the maximum of our production. There has been a great changeover from peace industries to war industries, and the financial transition has also been a difficult one. It may be that we have reached only 75 per cent. of the

possible change-over; I believe that is very likely the case. It is very difficult to get a democratic nation to adjust itself to a new atmosphere, but within that 75 per cent. some of our people have done marvellous work. They have produced machines which turn out in two minutes shells that required two hours during the last war. Some of the engineers have done things, especially in regard to the defence of this country against mines and other fiendish devices, which will give every one of us a thrill of pride when the story is told. Therefore, although we may criticise deficiencies in production and perhaps question whether money is spent in the right way, I hope that credit will be given to the workers, both technical and administrative, and to the men in the workshops, who are putting every ounce of energy they can into the patriotic task of producing the weapons with which to win the war.

Mr. Benson: The fact that this Debate is taking place at the end of six months of the financial year enables us to make a fairly simple survey of how our finances appear to be going. I thought that the Chancellor was perhaps rather more optimistic in his speech than figures would justify. Within the past six months there have been issued out of the Treasury some £2,200,000,000, and the Chancellor told us that at the present time expenditure is at the rate of £13,000,000 a day. If that be continued, there will be an expenditure in the next six months of £2,400,000,000, making £4,600,000,000 a year. That is £400,000,000 more than the Chancellor estimated in his Budget speech. In his Budget speech he also estimated that there was a gap of about £300,000,000 which would have to be met from increased saving. The increase in expenditure of £400,000,000 over the Estimate will increase the gap to £700,000,000, unless there is a commensurate increase in the Exchequer income either from taxation or from additional savings. How we are getting on is rather difficult to estimate, particularly for the layman, who has not access to the figures which only the Chancellor can have, but if we take it that the Chancellor's estimate of taxation will be realised and if we take also the rate of saving for the past six months, we find that the Exchequer income will be about £3,500,000,000. The


tax estimate was £1,780,000,000 and the present rate of savings is about £1,720,000,000 a year. I am referring now to actual investments in Government securities and the savings banks, and not to more hidden investments. This means that there is a gap of about £600,000,000 to be filled. I have no doubt that the various funds the Chancellor of the Exchequer mentioned in his speech, such as the Colonial sterling balance, and various other matters, will tend to reduce that gap considerably, but nevertheless, instead of it being visibly closed since the Chancellor made his estimate of £300,000,000, the gap has been visibly opened.
I now wish to review the question of savings. By savings I mean the amounts subscribed to our various War Loans, and the amounts accumulated in the various working-class savings' organisations. Roughly, we have three sources of savings. We have the industrial reserves of limited companies and industrial companies, and we have private incomes, divided into large and small incomes. There is little or no hope of any increase in savings in respect of industrial reserves, because E.P.T. puts a limit to the amount of profits industry can make, and, therefore, puts a limit to the amount of profit that can be put to reserve and savings. In regard to larger incomes, the Chancellor knows very well that there is very little to hope for from this source. For many years the rich have not been saving. Of course, there may be reasons for this, such as high taxation, but I am not concerned with causes to-day. The fact is that the rich have not been saving for many years, and so far as war savings are concerned the rich are on the debit side. As a matter of fact the rich have been disinvesting, which, no doubt, is inevitable because of large commitments, Income Tax and Surtax ranging up to 19s. in the £. That is a fact which we must take into account in weighing up the possibilities of the Exchequer drawing additional national savings. With industrial reserves limited by E.P.T., and with the savings of the rich limited by the fact that they have been disinvesting, we are left with the really important source of savings, and that is the smaller incomes. It is to these smaller incomes that the Chancellor must look to

close the gap. These smaller incomes are also important owing to the fact that they comprise the bulk of the national income.
We all read that very ingenious pamphlet of Mr. Keynes, which was published at the beginning of the war, in which he assumed, taking the estimates of Mr. Colin Clark and others, that something like 3/5ths of the national income was included in incomes of £5 a week and under. War changes have probably emphasised the importance of the smaller incomes. As we all know, there have been very sharp rises in wages, and large numbers of people who were not employed before the war are now earning wages. Therefore the proportion of three-fifths has certainly been largely increased since the war, and with it the importance of the smaller incomes as a source of saving. What are the smaller incomes contributing to our national savings? The latest figures published, those for the past six months of the current financial year, show that they have been saving something like £300,000,000. That works out, on an average, at £11,000,000 per week. The Chancellor referred to the fact that small savings were on the verge of reaching £1,000,000,000 a year. That, I think, is an optimistic way of staling the facts. The vital figure is £11,000,000 per week.
It is very difficult to form any real estimate of the total income from which those savings come; one cannot form any real estimate unless one has a statistical department at one's elbow. Taking wages, smaller salaries, the profits of small middle men, small manufacturers and small shopkeepers, I do not think we shall be far out if we say that this income represents something in the region of £4,000,000,000 for the present year. Putting that against the statement of Mr. Keynes, and taking into account the fact that our national income has jumped up very considerably since the war, and that the proportion of the smaller incomes has increased relatively to the larger incomes, I do not think £4,000,000,000 is an over-estimate, but rather that it is an under-estimate. Out of that figure these small incomes are contributing by direct savings £11,000,000 a week, which is roughly one-eighth, or 2S. 6d. in the £1. But when one realises that on a very large proportion of the national income saving is at the rate of one-eighth, and that we are spending more than one-half of the total national income,


that eighth, hard as it may be for an individual to save, is not a very satisfactory figure.
In these matters I am afraid one has to take hard facts and figures as a basis for judgment. Therefore, I do not think we can be satisfied with the rate of savings at the present time. So far as we can see, the gap which the Chancellor of the Exchequer estimated is likely to be increased, and savings and taxation are unlikely to contribute to closing it. Savings which are being made in the major proportion of the national income are entirely inadequate to meet our enormous war effort. I do not wish to impute any blame, but merely to examine the facts. Under present circumstances it must be particularly difficult for people with smaller income to save, and I am not at all certain that we are going to achieve an adequate amount of savings by exhortations alone. I have previously discussed and criticised the War Savings Movement, and I do not propose to dwell on that question to-day. I think, however, that the Chancellor of the Exchequer will have to smooth the way to saving more than he has done up to the present, and this must be done in co-operation with the Board of Trade.
If we are to save on a largely increased scale, we shall have to go in for even wider rationing and price fixation. It is true that at present our main articles of consumption are rationed and the prices are fixed. The price of basic foods has risen, and these things are in short supply. It is impossible for a man doing heavy work to subsist merely on rationed food. He, or rather his wife who has to do the shopping, must go beyond the rationed foods. She has to find alternatives, and it is the expenditure on the alternatives that runs away with the money, because so many of them are not rationed and prices are not fixed. Whenever anything fresh comes on the market prices are fantastic— tomatoes at 5s. and 6s. a lb., pears at 2s., 3s. even 6s. a lb. Where you get basic necessities in short supply and people with more money than they have had before, you are bound to get expenditure on alternatives, and, if the alternatives are high in price, as they certainly have been, people will buy them first of all because they have more money than they have ever had, and secondly because they must get something to supplement the basic rations. If the Chancellor of the Ex-

chequer is going to raise money he has to make it more difficult to spend. He has to see to it also that the alternatives to basic rations are also controlled. It appears to me that in the past the Board of Trade have dealt with rationing purely from the point of view of supply-—that everyone must have a certain amount of certain necessities. In future we shall have to look at it from the financial point of view also, the point of view of curtailing expenditure. If the Chancellor is going to fill the gap, he will have to urge upon the Board of Trade a joint policy based upon financial motives as well as motives of supply.

Mr. Loftus: I should like to congratulate the hon. Member for Chesterfield (Mr. Benson) on his speech, which is obviously the result of great thought and study. I have only risen because I feel that, when we vote such a large sum as £1,000,000,000 in a thin House, it is right that we should not vote it entirely without Debate and rise at a very early hour, shortly after the Chancellor of the Exchequer has concluded his remarks. There should be some comments made upon his statement in this House, whose main function has always been to pay great regard to the finances of the country. My right hon. Friend has pointed out that it is almost impossible for the mind to realise what these figures mean. When we vote such a sum as this we reach a stage where money is subordinated to materials. We have realised that whatever it is physically possible to accomplish in the war effort we will accomplish. We will use every ounce of man-power, every piece of machinery, every piece of material that we can acquire in the vital effort to win the war, to preserve ourselves and to preserve freedom for the world. Whatever is physically possible we will do, and we will then provide the money. I think that contains a lesson which I hope we shall remember in future when peace comes. We have accomplished this immense expenditure, we have utilised the whole man-power and much of the woman-power of the country, we are utilising it for utterly non-productive purposes with very little inflation so far—a certain amount, but very little. This makes one reflect that if during those bitter years 1929, 1930 and 1931 we had looked at the material facts and used some of our man-power, as we could


have used it, for revenue-producing schemes, we could have raised the standard of life without any inflation whatever and largely solved the bitter tragedy of unemployment.
The second reflection is this: My right hon. Friend has said that we must regard this expenditure as in itself producing revenue which will yield heavily in taxation to pay for the expenditure. There has been an enormous increase in salaries and wages and employment—an argument which we must again remember if ever we are faced with an unemployment problem when peace returns. The third lesson is that part of this £1,000,000,000 is being used for the rationing of consumption. I think in peace-time we shall continue, perhaps on a better and wider and more logical basis, this rationing of consumption so that there will be essential nutritive food for all.
The problem before the Chancellor is twofold. He has to raise the vast sum that he is asking us to vote, in the first place with a minimum of inflation. He has been most successful so far. There has been a certain amount of inflation. I think it has been a minimum, but it is no use disguising the fact that we have reached the point where we have, perhaps inevitably, to take further steps to prevent the danger of inflation. My hon. Friend the Member for Chesterfield pointed out an interesting thing when he estimated that we were spending over one-half of our national income on the war and that the vast bulk of bur people with incomes were saving roughly one-eighth. That is not good enough. The fact of which we should all be conscious to-day is that six months ago we recognised the danger of inflation, that drastic steps would be needed to prevent it and that we were prepared to consider further steps. We accepted the last Budget with its terrible taxation as a means to prevent inflation, but the danger to-day is far greater than it was when that Budget was introduced. The reason is that when we discussed it we were providing for this great effort to produce munitions only for our own Armed Forces, but to-day we have to produce munitions for our Ally Russia. That imposes a burden which will be, I will not say intolerable, but will intensely increase the burden of production and the sacrifices involved. That is

why I would beg the House to realise that if six months ago we were concerned about inflation, we must to-day be far more concerned because we have to increase our production more than ever.
How are we to guard against inflation? I agree with my hon. Friend the Member for Chesterfield that we must inevitably be driven to much stricter rationing. I do not think we can avoid inflation with present measures, and we must extend rationing to many objects which are not included to-day. There is an understandable movement in many industries to raise wages. The Government White Paper suggested a policy on wages, but that policy has not been adopted. There is no doubt that if there is a general rise in trade after trade in wages and salaries, we shall be heading towards really bad inflation. That will be against the interests of every class and individual in the country. We have to face that problem. I believe it wrong not only to raise wages but to raise salaries. I go further and say that, generally speaking, no income above a certain minimum should be allowed to be raised owing to the war. We have to face the fact that we have to make bitter sacrifices and that we must deny ourselves of things individually and as a nation and concentrate on the munitions effort in order to provide not only for ourselves but for Russia.
The second problem before my right hon. Friend the Chancellor of the Exchequer is to make the burden of interest on the future as light as possible. My right hon. Friend legitimately congratulated himself on the fact that whereas the last war was financed at 5 per cent., this war has been financed at 2½ and 3 per cent. He is entitled to full satisfaction at that contrast, but may I warn hon. Members that if every year we raise the National Debt at 2½ per cent. to the extent of double that raised in. the last war, the burden of interest will be the same? We must make every effort to minimise the burden on the future. A great deal has been done, and the interest rate is low, but has everything possible been done? I suggest that if we had a publicity campaign initiated by my right hon. Friend the Prime Minister and supported by every hon. Member throughout the country, asking people, in order to save the country, to subscribe to loans without interest, we would be astonished at the


response. It has been done on a small scale without any publicity, and I believe it could be done to a greater extent with publicity. In our people there is a spirit of sacrifice, and I believe that the idea that one can only help the country if one gets 2½ per cent. or 3 per cent. does not apply under present conditions. I beg my right hon. Friend to think over that suggestion.
My hon. Friend the Member for Chesterfield dealt with the gap between genuine savings and created money, a gap which, he pointed out, amounted to hundreds of millions. That gap has to be bridged by the creation of money through the banking system. I repeat what I have said on many occasions, that where there are genuine savings, especially by the small man, rates of interest up to 2½ per cent. can be given. Where there is creation of money to bridge the gap through the banking system, the rate of interest should cover only the cost of the creation of that money. The "Economist" estimated that that cost was 1 per cent. Today on Treasury deposit receipts we are giving 1⅛ per cent. I am willing to accept the point that the servicing of Government expenditure costs 1⅛ per cent. What does concern us that it is a short-term method of raising money. These Treasury deposit receipts can be converted, and are, I think, being converted, into long-term loans at 2½ per cent. I feel that where money is created to bridge the gap it should be perpetually at no higher charge than 1 per cent. That is a point which I have made before and I would press it upon the notice of my right hon. Friend the Chancellor.
Finally, with the great increase in expenditure before us, and with the prospect that all our energies will be required to face the gigantic additional tasks of making munitions and shipping munitions to Russia, it is obvious that we shall have to give more attention than ever to the allocation of our man-power and our material. We shall have to get a scale of priorities clearly into our minds and the mind of the Government. As regards the £1,000,000,000 which we are voting today, which will buy ships and aeroplanes and guns and tanks, pay the Army, Navy and Royal Air Force, and meet the thousand and one other expenses, and also which will pay for the tanks, aeroplanes and guns for our Russian Ally, I

hope that when the expenditure of this money takes place the Government will realise, as I am sure they do, that the first priority in an Island like this, either for man-power or material—steel, iron and so on—must not go to the tanks but must be allocated to shipping and to the Royal Navy, on whose existence we as a nation depend and which alone provide the means to convey the urgent help required by our Allies to-day.

Miss Ward: After two such thoughtful speeches I feel that I ought to preface my remarks by apologising for a somewhat unprepared speech, but I see here an opportunity, too good to miss, to say to the Chancellor of the Exchequer one or two things which I have be en wanting to say for a very long time, and in addition it is an opportunity to raise a matter on which I feel very strongly, namely, the pay of officers. I agree with a great deal of what my hon. Friend the Member for Lowestoft (Mr. Loftus) said on matters of high finance, but I am going to deal with smaller points. After the speech made by my right hon. Friend the Chancellor I feel that so far as the big problem is concerned things are going well, but it may be that he is so much involved with the big issues of finance that he overlooks some of the smaller points, which are equally important to the war effort and on which a measure of justice in our administration depends. It is a curious thing that in this country the Treasury, which is so often the Department which prevents progress, is hotly defended by Ministers in charge of Departmental Votes, though behind the scenes they have often waged wordy battles with the Treasury. A friend of mine told me the other day that when my right hon. Friend the Chancellor of the Exchequer was Secretary of State for Air he pressed for a great many alterations which the Air Force wanted. He put them forward as the political chief of the Air Ministry, but he opposed them as bitterly now that he has become the Chancellor of the Exchequer.

Sir K. Wood: There is no truth in that whatever. I do not know who the gentleman or lady was.

Miss Ward: I can put my right hon. Friend's mind at rest on one point. It certainly was not a lady who told me. At any rate, I have confidence in the source of my information, otherwise I


would not make the statement. I appreciate that when one is in a Department, one sees only the needs of that Department, and that when dealing with wider issues one may take a broader point of view, but although my right hon Friend repudiates my statement, all I can say is that it is "on dit" in the Air Force, and perhaps it will be as well for my right hon. Friend to clear up the point. I cannot go further than that, because he knows perfectly well the struggle which back benchers have to get any information on which to base their charges against the Government. But this I do know, that in this country you can always depend upon a Department defending its Vote against an attack which may develop, although what has happened is really the fault of the Treasury. I remember that when the right hon. Member for Westmorland (Mr. Stanley) was Secretary of State for War I did get in one little dig against the action of the Treasury, but although there had been a great deal of criticism from the War Office about the obstinacy of the Treasury on the point, instead of leaving it alone my right hon. Friend got up and hotly defended the Treasury. To me, that is bogus. The Treasury is entitled to its point of view; as the guardian of the public purse it is entitled to look after the general finances of the country, but if in so doing it hinders progress or creates injustice it ought to be open to attack, and I say frankly that I propose to criticise it to-day in respect of one or two matters.
I start with one small point, so that I can get myself really worked up to my major theme. I wish to say a word about the salaries paid in Royal Ordnance factories to the State-registered nurses working there and to speeches made by my right hon. Friend the Minister of Health asking for nurses to come forward to be trained and setting up a committee to discuss salaries, for he realises that the salaries paid to nurses are woefully inadequate. Ought not a Government Department to give a lead? Ought not a Government Department to insist upon a rightful standard of pay? What do we find? In the Royal Ordnance factories the scale of pay for State-registered nurses is below the standard of the Royal College of Nursing scale. I know that that scale has not been accepted by the Government, but it is not an extravagant

scale. It is a very ordinary scale in view of all the skilled work put in by the nursing profession. What is the good of one Minister setting up a committee to discuss salaries if a Government Department which employs nurses does not give a lead to the country? I understand—and I hope my right hon. Friend the Chancellor will accept this—that the Ministry of Supply would like the nurses in the Royal Ordnance factories to be paid on the scale of the Royal College of Nursing, and that the opposition comes from the Treasury. Therefore, I should be very grateful for an answer. I am prepared to wait a week, a fortnight or even a month for the Treasury, but I hope that, before long, there will be an announcement that a proper and adequate scale of salaries is to be paid to the nurses in factories owned by the Government. I do not propose to talk about industrial wages. If I did, I could go on speaking for the whole afternoon. Nevertheless, girls going into armament factories may never have been at a bench before. They are doing unskilled and semi-skilled work, and they are earning good money, some of them more money than a skilled and trained nurse who put in years of work in order to gain her experience. The Government allow that to go on, and the Treasury are responsible. I leave it at that, but I expect an answer.
I come to another point. I am not raising the whole issue of pensions or of unequal compensation, but am taking one small point. With the agreement of the Treasury and under the terms of the Royal Warrant, pensions are granted to dependants of sons killed in the war, upon the basis of a need test. I heard the case of a man whose son went down in the "Royal Oak," and I fought that case for six months in order to obtain a pension for the man, and I won. The man is drawing money also from the Assistance Board. All the facts were in possession of the Minister of Pensions when the pension award was made. The award was made within the terms of the Royal Warrant. So far as this point is concerned, the conditions of the Royal Warrant are a disgrace, but I am not going on about that. After a six months' fight the man won a pension of 5s. per week. The Assistance Board then reduced his allowance by taking off 4s. 6d. per week, and the man was 6d. better off, although all the facts were


known and the pension was granted on the basis of need, with full knowledge of the facts. I do not know whether that was the fault of the Treasury, or whether any arrangement was made between the Minister of Pensions and the Minister of Labour, representing the Assistance Board, to cover cases of that kind. I do not know whether the Treasury were even asked, whether they refused or whether they accepted. I know that this is a small point in relation to the general problem of finance, but, my goodness, it matters a great deal to that man in that mining village, and my blood boiled when I heard what had happened. I have given the House my views on the subject.
I come to the question of the so-called increases in officers' pay. A cynic said to me not very long ago that as long as you spent your money within your terms of reference you could spend any amount, and the Treasury let you do so. I should like to know the estimated cost per head, taking the expenditure of every Government Department, of each child evacuated. I believe that would make a grand figure to give to the country. I am not against evacuation, and I think the Government were absolutely right in providing a holiday for the children, but the parents of this country have a responsibility. I am against compulsory evacuation, but if parents want to send their children away it is a wise policy. If provision has been made, well and good, but to go on spending thousands of millions of pounds quite out of proportion to the number of children who have been evacuated, and at the expense of other people who have to give service to the State, is wrong, whether such action is inside or outside the terms of reference.
I would like to ask exactly the same question about the hostels in connection with armament factories. I am not criticising their building, and I am not saying that the girls ought not to go there, but I should like to know how much has been spent per head upon the girls who have taken advantage of the hostels. I want to know which Ministers go to the Treasury and get more money than other Ministers do. I can give the answer to that question, but I think Ministers know the answer already. To my mind, that position is false: it is not real. In this war we have to be realists. I want to see everybody fairly treated. I do not

want to see those who cannot light for themselves, such as the Service people, neglected at the expense of other people, and someone has to get up in this House and speak about these matters.
I do not propose to deal with the whole issue of allowances to wives of men serving in the ranks, but what makes me mad is that Ministers wait until there is a public agitation, until public opinion, based upon knowledge, is so roused that it demands a change. Then the Treasury acquiesces. Why can you not decide what is just and honest and give it, in advance of public opinion? Is not that the job and the right of the Treasury, and ought that not to be the Treasury's policy? I know that public opinion rules in this country. Thank God this is still a free country, but why always wait till the newspapers print articles, letters and demands by people who know what they are talking about because they are mixing among the people in the country? Why wait until the usual channels of communication come into operation and we have a Debate? I have not the slightest doubt that some concession will be made in this matter, but do hon. Members think that that is the way to treat the wives and families of men who are serving in the Forces, and who are prevented by the law of the land from making their own representations, and their own agitation?
People in the industrial world have a right to go to an independent court of arbitration for their grievances to be weighed up. They do not have to wait upon public opinion or upon the Treasury. It has been rightly pointed out that a vicious spiral affects the lives and the pockets of those who are dependent upon money provided by the State. No, Mr. Chancellor of the Exchequer, we have to do better than that in this country, if we are to have equality and justice.
I come now to my main point, the announcement about officers' increased allowances. I am not experienced in the technical language of the Service Departments, and it is not for me to say the right amount of pay for officers in the Air Force, the Navy or the Army. I know it is said throughout the country that nobody pays any attention to their difficulties, their needs and their position. It is no use answering me by saying that


there is the War Service Grants Committee, because I am a member of that Committee. I know our limitations and our terms of reference, and what we can and cannot do. We look round and see what has been done, after months of negotiation, for officers in the Services. Yesterday I put a very direct Question to the Secretary of State for War, when I asked whether the Service Departments were satisfied. The Minister said, "Yes." I asked him whether further representations were being made behind the scenes, and I understood him to say that there were not. That may be the political way of defending the Treasury. I do not really know, but I am not dumb and I do not live in a glass-house or in a nunnery. I try to see what is going on in the world.
During the last few days I have had an opportunity of hearing some of the views of the Service chiefs. I am not going to say which Services, but I do know their dissatisfaction. I know what their views are, and I know of some of the representations that are being made behind the scenes. I wonder whether the Chancellor would have had the courage to reduce an already very small allowance in the case of any other single class of the community, in order to meet the increases on another account, and whether he would have got away with it? He knows perfectly well the difficulties which officers face in making public representations. We know how few people in this country will stand up and ask for their rights to be considered. I am doing it to-day, because I have a certain amount of knowledge, and because I know the feeling of dissatisfaction which exists.
Our victory ultimately depends on the leadership given to our three Services, supported by the men who are in them. No matter what is said about the consideration given by the Government to the difficulties under which some of these officers—I am referring principally to the married ones—live, it is no use: we ought to see that the officers have just as square a deal as the ranks, and that the Services have just as square a deal as the industrial workers. I have come to the conclusion, rightly or wrongly, that the Service chiefs have succumbed to the Treasury. I know there is a great deal of dissatisfaction in all the Services about alterations which have been made. The

people who grumble do not grumble openly; they are far too decent and modest about making their claims, and so I am doing so to-day because I think it is right. I do not know what is going to be done, but I do hope the position will be reconsidered.
As I am rather a rebel myself, I could not help chuckling when I saw the other day that my right hon. Friend the Minister of Labour, when he could not get his own way, said that he would himself take a memorandum about agricultural workers to the Cabinet. Of course, it was not in accord with the usual Parliamentary tradition, but I wonder whether the Cabinet will turn that memorandum down. I should like to see some of our Service political heads taking the same line on behalf of the officers. Do the Government think that it is in accordance with justice to pay to a trainee at a Government training centre, a man who may never have had a tool in his hand or never have stood at a bench, a wage of £3 a week, nearly the same amount as is paid to a lieutenant who has the responsibility of leading men? Then you take men who have worked their way from the ranks through the O.C.T.U., men who have the quality of leadership, and you say to them, "If you are a lieutenant and married, you are to have 2s. a day deducted from your lodging allowance"—or whatever it is called— "and if you are a captain with one child, you are to have 2s. a day deducted from your wife's allowance, and 1s. 6d. a day from your child's allowance, a total of 3s. 6d." We were asking for an increase. I am not criticising the basis on which the awards have been made; I am rather glad that allowances have at last been given for families. I think that is a good policy and a wise policy, but I wonder who took the decision to try and balance it up by taking something from the niggardly, measly little allowances already granted?
To turn now to a very different thing. I am told there have been some new Army regulations. I may be starting a hare, and I confess that the War Office takes so long to give any explanations about anything that I have to raise it now because it may be a year before I get another opportunity. An alteration has been made to the regulations which defers the grant of rank to men coming from the O.C.T.U. I do not know what the technical explanation is and I have not been able to find out. A case was brought to me and I asked the


War Office to confirm or reject it. I got no answer, and so I told them that if I did not get an answer to-day, I should have to raise it here. There is a suspicion in the minds of some officers that this is a Treasury way of saving a little money. I will go no further, but if it is true, I shall take another opportunity of raising it. If it is not true, I shall be very willing to apologise. I have waited for this opportunity for months and months, and I am delighted to have it.
One more word about the War Service Grants Committee, because I beg the Chancellor not to put that up as the method by which officers' rights and claims are adjusted. We know that whatever recommendations may be made by the Advisory Committee to the Minister of Pensions, the latter has to go to the Treasury to fight the case, if he agrees with our recommendations. The Treasury has the right to accept or reject. I would like the Chancellor to see how carefully the terms of reference were drawn up for that committee when it was set up. Another word regarding advisory committees, in view of what appeared in the "Times" yesterday. Advisory committees are set up in Government Departments; they have no powers and merely advise. Ministers are always referring to advisory committees and they always take the advice of those committees, but advisory committees have no power or right to go and argue with the Treasury. I wish the Government would set up less advisory committees and give a little more power to a few people to examine conditions and then make sound recommendations. It is a lovely thing for a Department to have an advisory committee to hide behind.
I was very amused the other day when I addressed a question to the Financial Secretary of the Treasury. I asked him how many advisory committees had been set up during the war. He said there were so many that it would not justify the work to find out how many there were. I did not want to put his Department to that inconvenience; I had got what I wanted. An advisory committee is something which many Departments are very pleased to have because they help them out of many holes and difficulties. I almost ought to say to the Chancellor that I am sorry, but I know he would not like to deprive me of my pleasure. This is really a vehement speech, delivered with

all my heart. We have not forgotten his good work as Minister of Health. Somehow he must have altered since he became Chancellor of the Exchequer. He ought to have had a part in "Dear Brutus." Then, if he had started as Minister of Health, he would still, as Chancellor, be the same. Unfortunately he has not carried out that tradition, because he has changed. I ask him, in the ordinary interests of justice, to find out whether, in connection with the money that is spent for which he has no responsibility, but which has a vital effect on the general life of the nation, the terms of reference could not sometimes be tightened. I ask him also whether he could not do something to bring about a proper balance between the industrial and Service and the Civil sides of our expenditure, thereby making the sacrifice which the community is longing to make, and is making, to the war effort, really a sacrifice on terms of equality.

Mr. Sexton: It seems rather ungentlemanly to rob the hon. Lady of the woman's prerogative of the last word. In this case it was not only the last word, but a very vigorous criticism of the Chancellor of the Exchequer. Ever since I came to this House I have been impressed by the right of the Commons in matters of finance, and in a small way I have taken part in almost every Budget Debate during the time I have been a Member. This tremendous Vote of Credit, like the other tremendous Votes of Credit that have been before the House these last two years, is an alarming one to me when I consider its immense size. I can remember, when I was a small boy, counting the halfpennies and pennies out of my money box. When they totalled one shilling I thought I had done very well. I was never much of a financier, and I never thought that I should be sitting discussing a Vote of Credit for f,1,000,000,000. I cannot grasp it yet; I do not suppose any Member can. That £1,000,000,000 has to be found evidently, and it is our duty, right and privilege as Members of the House to look carefully into these questions of Votes of Credit to see that they are obtained in as fair a manner as possible from all members of the community in the form of taxation or borrowing, and to see, further, that they are spent wisely and well; that, in common parlance, we get value for money.
It is essential in peace-time to scrutinise Votes of Credit and expenditure, but it is more essential in war-time, especially in such a war as we are engaged in at present, because man-power and material power are conditioned by finance. And not only our own man-power and material power, for we have now undertaken an additional obligation in going to the assistance of our gallant Allies. Probably we shall have to find more money still. This money has to be found, and the Chancellor is trying to find it in various ways by the savings of the people and by borrowings. On the savings side, the direct savings side, I think it is right and proper that the small investors should be complimented on their magnificent work. I was pleased to hear that the small investors were nearing the £1,000,000,000 mark, I took it from the Chancellor of the Exchequer. It is a prodigious effort for the small savers in this country, in the small space of time that the movement has been in existence, to aggregate almost £1,000,000,000. We ought to let it go forth from this House, not that we are satisfied, or that we think we have reached the ultimate goal, but that we are complimenting these small savers and adding a word of encouragement to them to carry on the good work for another year, and another year still, until the war is finished.
But I noticed that the Chancellor seemed, to me at any rate, to skim over those people who ought to be able to lend larger sums of money. He did not make it clear to my mind that he was either complimenting them or that he was satisfied with them. I should like to hear, sometime, exactly how these larger savers, as I call them, are lending to the Government. It seems to me that they are withholding their savings on account of the rate of interest. Perhaps, if I were a financier, I should do the same, but I notice in the newspapers, and other people are noticing it also, that speculation still proceeds on the Stock Exchange, that there must be some money to burn somewhere as it were, and we are wondering whether some of this money cannot be roped into savings. I was pleased to hear the Chancellor speaking about avoidance of waste and extravagance. That call goes out, I take it, to every person in this country. Waste and extravagance in time of peace are bad, but waste and extrava-

gance in time of war are criminal. Not only that, but waste and extravagance are right-hand supporters of Hitler and the enemy. Therefore I hope the people of this country will take further warning from the words of the right hon. Gentleman in this Debate and try, as far as possible, to avoid any waste and extravagance.
I have noticed a number of those invaluable Reports of the Committee set up on National Expenditure. The Chancellor has told us that they are scrutinised, examined and acted upon. We are all very glad to hear that. I have just a small point on waste that I asked the Secretary of State for War about in a Question. That was, that we are spending public money on our soldiers, who are going on the grouse moor fells and beating for shooters. The right hon. Gentleman looks as though he does not know anything about it. I asked a Question about soldiers going on grouse moors in the North of England and beating the fells for shooters, for which these soldiers got no pay except what they were getting from public funds. It is a small point, but it represents the violation of a principle. I object to paying taxation part of which is to be paid to soldiers for beating on the fells for shooters. I have no objection to the shooters having their sport, but let them pay for it. The soldiers get no pay except liquid refreshment. I was given to understand that nobody in the agricultural line had asked for these men, who, although the Minister said that they were not living in an agricultural area, were actually living in an agricultural area. I live in that area myself, and I know that it is purely agricultural. The fact that the farmers had not asked for the assistance of the military is perhaps because they could not obtain them on the same basis as the shooters did. If they could have had them for liquid refreshment and, no pay it is possible that there would have been a great demand for them.
I come to the question of inflation and the White Paper on wages. We are told, and we accept it, that the Government have done valuable work in stabilising prices of certain commodities; but, as in the last war, there is a lag between the cost of living and wages. The cure may be to stabilise the prices of more commodities, and then it might be possible to do something about stabilising wages. I do


not know, but so long as there is that lag so long will you have that chase which is called inflation. Many people in this country are of opinion that with wages fixed on a dead level, as widows' pensions arc almost on a dead level and as work-men's compensation is, it is not fair to ask the people to bear the burden of the increased cost of living. Some means should be devised by the Government. The question of increased pensions would not arise if the Government would only stabilise the prices of far more commodities and reduce the gap between income and expenditure. This total war is going to mean total sacrifice. If needs be, we shall all have to go on a siege income and a siege ration. As far as I can see, going around my own constituency and the neighbouring constituencies, the people who have considered the question are behind the Government, even to the sacrifice of siege incomes and siege rations, in their efforts to win this war.

Sir Stanley Reed: I think everybody here will agree with the hon. Member for Barnard Castle (Mr. Sexton) that in time of war waste and extravagance are a crime. I go further than that, and say that any expenditure on anything which can be done without at such a time is as much a crime as waste and extravagance. I want to speak on a subject which is constantly being raised in this House, and from the corollary of which Members steadily run away. That is the question of inflation. Inflation is always hanging over us. It is perhaps the most deadly enemy we have to meet. If inflation comes, the responsibility will lie 90 per cent. on the Members of this House. I say that definitely, and without fear of contradiction. I am regular in my attendance at this House, and I listen regularly to Debates. Scarcely a day has passed while I have been a Member of this House when there has not come from one side or the other—all parties are equally guilty— demands for more expenditure; for more allowances here, for higher pay there, for greater consideration somewhere. Those demands are often based not on the needs of the individual concerned, but on the fact that somebody else is getting more, or is in a more favoured position. If the House goes on as it has done and listens to arguments, such as were put forward from the other side only to-day, in favour of higher pay and allowances, higher this

and higher that, not because they are imperatively needed to meet the economic requirements of the individual or the class owing to our reduced living standard but because other people are getting more, then, as sure as night follows day, the curse of inflation will fall upon us, and it will fall most heavily upon those members of the community least able to bear it. The greatest service we can render to the people of this country is to drive home to them, day in and day out, that a reduced standard of living for all is imperative, for our own safety, and, above all, in preparation for the years which are to come.
I am looking beyond the needs of today: I am looking to the future. I am convinced that the future is going to be a grim one. We must prepare ourselves, in season and out of season, to meet that day when it comes, without shock and without social disturbance. So far from criticising the Chancellor and the Treasury for being too harsh, I would say if they have sinned they have sinned in not being hard enough. This argument about the dead hand of the Treasury is trotted out in the House and in the country too often to cover poverty of thought and inadequacy of information. Our most serious dangers are not in the dead hand of the Treasury, not in the control of the Treasury, but in emotional appeals here and there to which the Treasury is right to turn a deaf ear. The Treasury is our greatest safeguard against the greatest danger that we have to face; and that is the peril of inflation, which hangs over us to-day, and which I regret to say—and I say it with all respect—many Members on all sides of this House are doing their level best to bring down upon us.

Mr. Austin Hopkinson: There is one small point that I wish to raise in connection with the statement of the Chancellor. My recollection is that he stated during his speech that in the case of aircraft production the vast bulk of those contracts were on a fixed-price basis. Will he kindly correct me if I am mistaken? Then I take it that it is correct. Can he inform me from whom he got the information and whether he has taken any steps at all to find out whether he has been misinformed or not? The statement to which I wish to call the attention of the House is simply that the vast bulk of aircraft contracts are on a fixed-price basis.

The Financial Secretary to the Treasury (Captain Crookshank): I think I can put my hon. Friend at ease. My right hon. Friend is checking it up, but I do not think that the word "aircraft" was the accepted word. He was speaking about the whole total of all the contracts which had been let out by all Departments. I do not think that he made any reference whatever to aircraft contracts, but the aircraft contracts, the whole lot of them, can be checked up. My right hon. Friend was giving a general review of the whole of the contract position, which, he pointed out, was much better than it had been a year or eighteen months ago, and it is that which the right hon. Gentleman opposite, who with the public has been very much concerned about all these contracts, was good enough to support.

Mr. Hopkinson: May I take it that, although I was incorrect and my memory failed me, the Chancellor of the Exchequer did not say what I thought he said, but that what he actually meant to say was that the vast bulk of all war contracts were on a fixed-price basis?

Sir K. Wood: I will read what I said. I was referring to a particular method, and I said:
This method with various refinements has been used over a wide range of manufactures. It is, however, admittedly less satisfactory than a fixed price, and I am glad to say that with increased experience and the decline in the proportion of new types of products required an increasing proportion of contracts is being let on fixed prices. For example, aircraft contracts are to a very large extent let on a fixed price basis.

Mr. Hopkinson: May I ask what the right hon. Gentleman implies by "a very large extent"? What sort of percentage to total aircraft profits?

Sir K. Wood: I think that my hon. Friend had better put a Question on that matter.

Captain Crookshank: I think that it had better be explored in another way; I am not prepared to deal with it off-hand now. The Debate has been very wide and has shown that the views on the general financial situation explained by my right hon. Friend have the general acceptance of the House, and it is not therefore necessary on this occasion, as it is sometimes, to enter into detail and go through everything that has been said. I must say something with regard to the speech of

my hon. Friend the Member for Colchester (Mr. Lewis), because he asked for an assurance from the Government with regard to what might happen to sterling vis à vis gold or the dollar, and he wanted an assurance that the Government had not contemplated agreement with the United States on that matter. I know that my hon. Friend has unfortunately been away from the House for a considerable time owing to ill-health, but that Question has been asked before and answered quite categorically. All I need do is to remind him of the reply which my right hon. Friend gave on the 10th December, 1940, to a Question put by the hon. Member for Ipswich (Mr. Stokes), in which he asked:
Whether he will give an asurance that no undertaking, specific or implied, has been or will at any time be given 1o the United States of America that this country will return to the gold standard after the war without first consulting this House.
The answer was:
There has never been any question of giving any undertaking of the kind suggested." —[OFFICIAL REPORT, 10th December, 1940; col. 785, Vol. 367.]
That still stands, and for the further comfort of my hon. Friend I would say that one must remember that anything that has to do with the gold standard requires legislation and it would be necessary for this House, as was the case when it happened after the last war, to deal with it should it arise.

Mr. Lewis: Is my right hon. and gallant Friend in a position to say that no understanding has been come to between ourselves and the American Government as to linking sterling in any way with gold or the dollar after the war?

Captain Crookshank: I cannot take it any further than what I have said in reference to it. These are not matters to be lightly bandied about, and a shade of meaning of one word or another might cause very great difficulty. The statement to which I have referred conveys the position of the Government, and I would ask hon. Gentlemen to leave it at that. If my hon. Friend wants a further considered statement, as he or any other hon. Member is entitled to receive, perhaps he will put a Question on the Paper and give my right hon. Friend the chance of putting exactly the words that are suitable. Words are very often open to misinterpretation when used on matters of high


policy in this House. Even if my hon. Friend has not tried to lead me into a trap, I hope that he will not let me get even into the danger zone.
The other remark I wanted to make on the main issue was to the hon. Member for Chesterfield (Mr. Benson), whom I am sorry I did not hear. I gather that he was very anxious and that he thinks that sufficient savings are not coming in at the moment. It is true that there is room for improvement there. One of the solutions, as I understood it, is that a great deal more rationing should take place, and rationing as a whole should not be looked at only from the point of view of the supply position but also from the point of view of my right hon. Friend respecting expenditure. That is a point which has long been considered by the Departments concerned, and it is not a matter solely for the Board of Trade or for the Exchequer. But there again, I am not prepared, in reply to the speech of the hon. Member to-day, to make a considered answer on behalf of the Government about it, but it is not a matter which has been entirely overlooked.
That, I think, in view of the general acquiescence of the House with my right hon. Friend's statement, very well deals with everything which it is necessary to say in general, but I am extremely obliged for the words which have just been uttered by my hon. Friend the Member for Aylesbury (Sir S. Reed) where he tried to pin the responsibility of the risk of inflation where it rightly lies, and that is in this House. It has been reiterated by myself not only in this House, but elsewhere, that further expenditure on this, that and the other thing, increases the amount of money available in the pockets of the people for spending. That is the real danger. I hope that hon. Gentlemen will read what he says, and when taking, as I am sure they will, their share in the forthcoming campaign for further savings, perhaps they will use extracts from his remarks as a background for their speeches.
There is only, therefore, one other speech to which I ought to say anything, because it was outside the general stream, and that is the speech of the hon. Lady the Member for Wallsend (Miss Ward). I do not know whether I am to accept every word used in her speech as being really intended to be true.

Miss Ward: I do not know what my right hon. and gallant Friend means. But as far as anybody can believe what they say, I believe that what I said was true. I would not dream of saying anything to the House that I did not believe.

Captain Crookshank: I am sorry, but twice the hon. Lady said something or other made her mad, and I was hoping that that was not quite true. She apparently wishes it to be thought so.

Miss Ward: There are different sorts of madness. Sometimes it is a good thing to be mad.

Captain Crookshank: But it is better to be accurate. In some of the statements she made she was so wide of the mark that I do not want to weary the House by controverting them now. All I would ask is that the House should not accept all she said. For instance, she observed that a trainee drawing £3 a week was better off than a junior officer, which is absolute nonsense.

Miss Ward: I am sorry to interrupt, but I did not say any such thing. I said that to pay £3 a week to someone who had never handled a tool was unfair in comparison with a junior officer.

Captain Crookshank: That is exactly what is so gloriously inaccurate. They are nowhere near the same level. The junior officer gets something like us. a day, and over and above that his allowances, rations and all the rest of it. The figure is not comparable at all with 60s. a week. If my hon. Friend has a good case it is not really helped by over-exaggeration. When talking about marriage allowances she said that certain officers would have so much taken off per child, and so on, but nobody Is to have any deductions at all. It is quite misinterpreting the effect of these marriage allowances, although I do not want to argue with her on these points.

Miss Ward: Is there a different scale payable to officers to be commissioned in 1942, compared with the scale which is being drawn now?

Captain Crookshank: I do not intend to argue all these points.

Miss Ward: But could my right hon. and gallant Friend answer that point? Could he say categorically whether it is the same scale or a different scale?

Mr. Speaker: We cannot go on like this.

Miss Ward: On a point of Order. My right hon. and gallant Friend must not misinterpret what I said to get himself out of a difficult situation.

Captain Crookshank: It is not such a difficult situation as all that. I would have adopted other means if it had been. As a matter of fact, these small administrative details are really questions for the Ministers who have to answer for their Department in this House. Generally speaking, I am saying that, with regard to the marriage allowance concession which was recently announced, there was no deduction in any particular case. There was a choice of scale for particular officers. Most of the points which my hon. Friend has raised to-day have been raised by her in correspondence with me or by Questions. What I would like to impress upon her, if I can—although I am not very hopeful —is that when she tries to put the blame, as she calls it, on the Treasury, she must realise—as I am sure every other hon. Member except herself realises—that these are matters of Government policy and there is such a thing as Cabinet responsibility. When she quotes something about the Minister of Labour saying that he would take a memorandum to the Cabinet, it is not an unusual thing to occur. In fact, that is the way in which a great deal of business is carried out. Proposals are made by Departments, discussed and considered, and eventually a decision is reached, and for that all members of the Government are equally responsible. The collective system of responsibility is one which obtains here, and, therefore, I hope she will cease from apparently trying to create prejudice as between Government Departments, and saying that my right hon. Friend always stops everything. He does not stop everything. Concessions are made, and all members of the Government are entitled to such credit as there may be for the result of their collective wisdom.
My hon. Friend said she wanted to get a lot of things off her chest, and, having done so, I hope she will not do it any more, but will realise that in these matter? there are careful consultations and no doubt on many occasions a certain amount of give and take, as is necessary between people who have to carry out a policy which has her assent as well as the assent

of practically every other Member of this House. I hope she will be a little more reconciled and that she will find that a good many of the complaints that she made to-day are not really justified. It is entirely wrong to say, as she did say, that what the Treasury did was to hinder progress and create injustices.

Miss Ward: Has my right hon. and gallant Friend seen my letter to the Ministry of Supply?

Captain Crookshank: I do not know anything about letters to the Ministry of Supply.

Miss Ward: But I have heard that it has been sent on to the Treasury.

Captain Crookshank: I am not prepared to be cross-examined about my correspondence, but I am prepared to say that when my hon. Friend says that the Treasury exists to create injustices and hinder progress she is making baseless allegations against a fine Department, presided over by a Minister whose speech to-day has won the admiration of everybody in this House except, possibly, that of herself. That being so, I hope that the fundamental principles which were evident in the speech of my right hon. Friend in regard to the Vote of Credit will win the same acceptance beyond these doors as they have done here, because he has shown once more, quite clearly, the lines on which we hope to advance in the coming months before we have to come to another Vote of Credit. Hon. Members have echoed him in saying that very great sacrifices will have to be made by everybody in this country if we are to continue, as we have been able to do so far, to keep our financial structure right.

Question put, and agreed to.

Resolved,
That a Supplementary sum, not exceeding £1,000,000,000, be granted to His Majesty, towards defraying the expenses which may be incurred during the year ending on the 31st day of March, 1942 for general Navy, Army and Air Services and for the Ministry of Supply, in so far as specific provision is not made therefor by Parliament, for securing the public safety, the Defence of the Realm, the maintenance of public order and the efficient prosecution of the war, for maintaining supplies and services essential to the life of the community and generally for ail expenses, beyond those provided for in the ordinary Grants of Parliament, arising out of the existence of a state of war.

WAYS AND MEANS.

REPORT (30TH SEPTEMBER).

Resolution reported:
That, towards making good the Supply granted to His Majesty for the service of the year ending on the 31st day of March, 1942, the sum of £1,000,000,000 be granted out of the Consolidated Fund of the United Kingdom.

Resolution agreed to.

Bill ordered to be brought in upon the said Resolution by the Chairman of Ways and Means, the Chancellor of the Exchequer, and Captain Crookshank.

CONSOLIDATED FUND (APPROPRIATION) (No. 2) BILL.

"to apply a sum out of the Consolidated Fund to the service of the year ending on the thirty-first day of March, one thousand nine hundred and forty-two, and to appropriate the further supplies granted in this Session of Parliament," presented accordingly, and read the First time; to be read a Second time upon the next Sitting Day, and to be printed. [Bill 57.]

FINANCE (No. 2) ACT, 1940.

Resolved,
That the Purchase Tax (Exemptions) (No. 1) Order. 1941, dated 11th September, 1941, made by the Treasury under Section 20 of the Finance (No. 2) Act, 1940, a copy of which was presented to this House on nth September, be approved.

Resolved,
That the Purchase Tax (Exemptions) (No. 2) Order, 1941, dated nth September, 1941, made by the Treasury under Section 20 of the Finance; (No. 2) Act, 1940, a copy of which was presented to this House on nth September, be approved.

Resolved,
That the Purchase Tax (Reduction of Registration Limit) Order, 1941, dated nth September, 1941, made by the Treasury under Section 23 of the Finance (No. 2) Act, 1940, a copy of which was presented to this House on nth September, be approved."—[Captain Crook shank.]

SOLICITORS BILL [Lords].

Considered in Committee.

[Colonel CLIFTON BROWN in the Chair.]

CLAUSE 1.—(Delivery of accountant's certificates to Registrar.)

Mr. Liddall: I beg to move, in page 1, line 18, after "examination," to insert, "to be made by an accountant."
This Amendment and the four following Amendments on the Order Paper in my name and that of my hon. Friend the Member for West Salford (Mr. Emery) all refer to the same matter, as does a manuscript Amendment—in line 3, page 16, leave out "and accounts" and insert, "accounts and documents"— handed in by the hon. and gallant Member for South-East Leeds (Major Milner). With your permission, Colonel Clifton Brown, and that of the Committee, I suggest that these Amendments might be considered together.

The Deputy-Chairman (Colonel Clifton Brown): If the Committee agree, I am willing that this should be done.

Hon. Members: Agreed.

Mr. Liddall: In my opinion, which I feel sure will be shared by the Committee, it is necessary for the accountant to see evidence of what a solicitor has received to start with in order that he may certify what has been done with the money, deeds, documents or securities. I hope that the Committee and my right hon. and learned Friend the Attorney-General will accept these Amendments.

Major Milner: These Amendments are of a drafting nature. As the Clause stands at present, an accountant instructed by a solicitor would have authority to examine only the solicitor's books and accounts. Clearly the intention is that if the accountant wishes to examine any other relevant documents of the solicitor, he should be able to do so, and these Amendments would give that power.

The Attorney-General (Sir Donald Somervell): I accept the Amendments.

Amendment agreed to.

Further Amendments made:

In page 1, line 19, leave out "to be made by an accountant," and insert "and of any other relevant documents."

In page 2, line 5, leave out "and accounts," and insert "accounts and documents."

In line 9, leave out "and accounts," and insert "accounts and documents."

In page 3, line 14, leave out "or accounts," and insert "accounts or documents."—[Mr. Liddall.]

In page 3, line 16, leave out "and accounts," and insert "accounts and documents."—[Major Milner.]

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 2.—(Compensation Fund.)

Mr. Douglas: I beg to move, in page 4, line 6, to leave out "of five pounds," and to insert
not exceeding one per cent. of the net profits of the solicitor from carrying on the profession of solicitor for the last accounting period for which an accountant's certificate has to be delivered.
This Clause relates to the fund which it is proposed to establish for the purpose of making restitution, in certain cases, to people who may have suffered through the default of a solicitor whom they have employed. As the Clause stands, it is proposed that this fund should be raised by means of an equal levy upon every solicitor, no matter what might be the extent of his practice or profits. That is a proposal of a very unusual nature. It is not general in cases of this sort that no regard whatever should be had to the ability of the individual to pay. This proposal means that the solicitor who has a very good practice and makes a large income would contribute no more than one who has a very small practice and a small income. I do not suppose anybody will suggest that those who are the poorest are the most dishonest. I sincerely hope no suggestion of that sort will be made. Indeed, it would appear on the face of it that the larger the practice the larger the risks involved. It has been said by those who are concerned in the promotion of the Bill on behalf of the Law Society that one of its objects is to increase public confidence in solicitors as a body, and thereby to secure for them the opportunity of engaging in their practice more successfully and earning more money. If that object is, in fact, achieved by the Bill, it ought to inure pro rata to the benefit of all persons engaged in the profession, those who are already doing well and those whose incomes and practices are comparatively small. Therefore, I hope they would make no objection to contributing to the fund according to their means. In the Second Reading Debate on the Bill, I pointed out the burdens which would be imposed upon solicitors by statutory enactment if the Bill became law. These burdens amount in all to an average of

about £30 or more a year. The Law Society is responsible for the statement that the average income of a solicitor is £400 a year. If that be so, the case is all the stronger for distributing the burden more equitably and placing it upon those whose shoulders are strong enough to bear it.

Dr. Peters: I listened with a good deal of sympathy to the arguments of the hon. Member for North Battersea (Mr. Douglas) but I hardly think that his Amendment is the sort of thing we ought to do in a Bill of this kind. I do not want to go into the arguments at length on this occasion, but I suggest that it would be far better to allow the Bill to remain as it is than to accept an Amendment which would place it more or less on a new basis.

Major Milner: I would point out to the Committee that all solicitors, whatever their incomes, pay the same amount for their certificate to practise. In London they have to pay £9, and in the country £6. In this case there is no discrimination between those in receipt of large or small incomes. I would also point out that the opportunities of the avocation do not vary in large or small practices. I can recall the case of a man with a small practice who was responsible for the administration of a large estate. Therefore, it does not seem to matter whether the practice is large or small. The proposal of my hon. Friend the Member for North Battersea (Mr. Douglas) had the consideration, although it was not a very lengthy consideration, of the Joint Select Committee, and it was pointed out then, and I am sure it will be clear to the Committee to-day, that it would be quite impracticable to have payments made to this fund on the basis of the amount of income received. If this proposal were carried, the amount of income would have to be disclosed in order that assessment might be made. It is true that accounts have to be audited, but the results are not necessarily disclosed to some body other than the Income Tax authorities. I imagine that there would be an outcry among the members of any business or profession which had to submit their takings or profits to some outside body. For that reason it is quite impracticable to adopt my hon. Friend's suggestion. I think that the proposal contained in the Bill is very fair. It is simple and it is easy of applica-


tion, whereas my hon. Friend's proposal would involve very considerable delay and very considerable practical difficulties. Solicitors or members of any other profession or trade would strongly object to the disclosure of their incomes for the assessment of payments to a fund of this character, and I hope my hon. Friend will not press his Amendment. I can assure him that it was carefully considered by the Select Committee.

The Attorney-General: I hope that my hon. Friend the Member for North Batter-sea (Mr. Douglas) will not press his Amendment. This matter was considered by the Select Committee, as my hon. and gallant Friend the Member for South-East Leeds (Major Milner) has pointed out. There are certain payments in all professions which are made at a flat rate so as to avoid the necessity of having ah investigation. It was felt that the present procedure was the best to meet the case.

Amendment negatived.

Mr. Douglas: I beg to move, in page 5, line 43, at the end, to add:
(10) The provisions of this section shall not take effect until such time as solicitors shall become exempt from the obligation of paying stamp duty upon practising certificates.
The object of the Amendment is to provide that the Clause shall not take effect until solicitors are exempt from the obligation of paying Stamp Duty upon practising certificates. Unfair burdens of taxation are imposed upon the profession, and no other profession has been singled out for taxation in the same way as have solicitors. A solicitor, in London, before he can continue to practise is obliged to pay each year for a practising certificate, for which the Treasury demand a sum of £9. He has also to pay a fee of £1 to the Law Society, and this Bill provides that he shall be subject to a levy of £5 a year towards the compensation fund, and that he shall be compelled to become a member of the Law Society, which imposes a further charge of three guineas a year. He is also obliged to pay for an audit and certificate, and this will cost at least 10 guineas a year. If as a matter of public policy this Committee is of the opinion that these fees and obligations should be imposed upon solicitors, then they ought in all fairness to relieve solicitors from the obligation

to pay special taxation which has no justification, justice or equity. It is a purely fortuitous circumstance that 140 or 150 years ago the then Chancellor of the Exchequer, casting about for revenue and being defeated in one proposal, chose to impose this burden upon persons practising in this profession. By accident, what was done then has, during the course of years, inflicted this extremely unfair taxation upon solicitors. There is no justification for it. Whenever this matter has been debated not a single person has defended it on grounds of equity. It has been defended by Chancellors of the Exchequer on grounds of expediency, but I hope we are now moving away from that view in dealing with matters of public finance, and that we shall try to adjust the burden of taxation proportionately and equitably upon every citizen.

Dr. Peters: I am afraid I cannot agree with my hon. Friend the Member for North Battersea (Mr. Douglas), or with the Amendment he has moved. It is quite clear, however, that the solicitors' branch of the legal profession is badly dealt with as far as taxation is concerned. A solicitor pays £80 on his articles, £25 admission fees and £9 or £6 for his practising certificate. A barrister has to pay £50 on his articles and £25 on his admission. An accountant pays 2s. 6d. on his articles and an annual fee of £10, and an estate or house agent pays 28. 6d. on his articles and an annual fee of £2. A chartered accountant pays 2s. 6d. on his articles and no more, whereas chartered accountants in these days are usually making a good deal more than lawyers. Architects pay 10s. on their articles and nothing further, and a doctor pays 1s. on his articles and nothing further. I quite agree that we should like to see some reduction, but this is not the time. Looking back to the time when this taxation was imposed, I think it is unfortunate that this question has been raised whenever the country has been at war. Therefore there is always an answer to it— nothing can be done. I cannot see that we can press the point at the moment, although representations have been made to the Chancellor of the Exchequer.

Mr. Goldie: Did I understand the hon. member to say that the taxation on the certificate is £9?

Dr. Peters: It is £9 if one practises in London and £6 in the provinces. That is the actual cost of the annual certificate.

The Attorney-General: Of course, everyone sympathises with people, professional or otherwise, who desire to get taxation reduced or their grievances, or what they think to be their grievances, redressed. I do not want to dispute for a moment that the sort of facts and figures the hon. Member has put before us establish a case proper for consideration, but I am sure he will realise that, after all, this is a tax that has been in existence for a very long time, and in present financial conditions it is obviously difficult to remit a tax which has been accepted, with protests from time to time, for a large number of years. When more normal conditions arise it may well be that the solicitors' profession will press more strongly, but it would produce a most unfortunate impression if, having considered these matters, in which there has been great public interest, they said they would not proceed with these reforms, some of which they admit are necessary in order to maintain the standard that they desire to maintain, unless the tax is remitted, in war-time. We could not accept the Amendment, which without wishing to enter into arguments on the question, no doubt will receive consideration on a different occasion.

Major Milner: I do not think there is much left to say, but I would like to tell my hon. Friend that I, and I think the members of the Law Society, are entirely in sympathy and agreement with the views he has expressed as to the illogicality of the taxation imposed upon solicitors compared with other professions. It is of interest to note, not only are the figures given by the hon. Member opposite correct, but that the totals of the taxation are very impressive indeed and really form a very substantial contribution on the part of the solicitors' branch of the legal profession to the national income. For example, in the 10 years ending 1938 no less was paid in Stamp Duties than £1,895,000. That averages £189,000 per annum, a very considerable sum indeed imposed on this branch of the profession. It is not imposed on any other section of the community throughout the length and breadth of the land. While one recognises that the present is not the best time at which to make an

application for the remission or a reduction of these Stamp Duties, one hopes that at no distant time some Chancellor of the Exchequer will be so impressed by the obvious injustice of this imposition, which was really introduced over 100 years ago by something in the nature of a side wind, that he will be willing to make a considerable reduction. I am also obliged to the Attorney-General for what he pointed out in regard to the position under the present Bill. I am afraid that for the time being the solicitors must bear the very substantial burden imposed upon them and trust in the sense of justice of some future Chancellor to make the remission which is really their due.

Mr. Douglas: I am not very much mollified in my attitude by the suggestion that this is a wrecking Amendment, nor that it is brought forward from motives of self-interest. I would not put forward an argument for the benefit of some particular section of the community. I have tried, and I hope I have succeeded in pointing out that a section of the community is subject to an unfair and discriminating burden, and I hoped that the Attorney-General, if he chose to use the ground of expediency during war-time as a reason for not acceding to my proposition, would have admitted the general line of the argument that this is an unjust discrimination against one particular profession and that the fact that it has existed for 140 years is no justification for it. There is a fresh generation of solicitors coming into existence at every moment, and the fact that their predecessors have been penalised in this way is no reason why it should continue for ever. Nor does the Amendment propose to remove the tax during war-time. It proposes that the provisions of the Section should come into operation at such time as the Chancellor of the Exchequer found himself able to remove the tax. That is the wording and the purpose of the Amendment. Nevertheless, I recognise that in war-time it is difficult to remove injustices if it costs money to the Exchequer. But I only accept that as an argument for a temporary suspension of the pressure which I think ought to be put upon the Chancellor to remove the tax, and I hope that hon. Members, whether connected with the legal profession or not, will in the future support the effort to redress this injustice. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

CLAUSE 3.—(Membership of Society.)

Major Milner: I beg to move, in page 7, line 18, at the end, to add:
(11) The provisions of Sub-sections (1), (2) and (3) of this Section shall come into operation on such day as the Lord Chancellor may by order appoint after he is satisfied on a poll taken by the Council of all solicitors for the time being holding practising certificates that not less than two-thirds of those voting are in favour of the provisions coming into operation.
While I am in personal disagreement with the object of the Amendment which is on the Paper in the name of my hon. Friend the Member for Nelson and Colne (Mr. Silverman), I move it because it has been put down as the result of agreement to which we have all been a party. There is the proposal in this Clause for compulsory membership of all solicitors of the Law Society. Some objection has been taken, principally by those who are not members, but also by some who are, to that provision in its present form. Therefore, it has been agreed that it shall not come into force until a poll has been held of all solicitors holding practising certificates. This provision for compulsory membership of the Law Society was approved at the largest meeting ever held by members of the society two or three months ago. It was also approved by the Association of Provincial Law Societies and the City of London Solicitors' Company, and was also carried at a poll of members of the society. Therefore, the Committee will agree that there are reasonable grounds for asking for this provision to be put in the Bill. Nevertheless, as it has been agreed that the proposal shall be postponed until a further poll has been held, I beg to move the Amendment.

The Attorney-General: I referred to this matter in my speech on Second Reading and forecast that this Amendment would appear on the Paper to meet certain objections which have been raised in various quarters. I hope that the Committee will accept it.

Mr. Goldie: There is one point that puzzles me. The Amendment says that the; poll is to be taken of all solicitors holding practising certificates. I understand that if a solicitor holds an official appointment he does not hold a practising certificate. Will he be excluded from the

poll? I am thinking of solicitors who hold such positions as district registrars and county court registrars, and it seems to me as if under this Amendment they could hardly be described as practising solicitors. In the interests of the profession, however, they are gentlemen who ought to be consulted.

The Attorney-General: I hope that my hon. and learned Friend will not press the point. This proposal as to who should take part in the poll has been considered and I think it is not unreasonable. I have no doubt that a very large number of the people concerned are already members of the Law Society. The line had to be drawn somewhere, and it was agreed to draw it at solicitors holding practising certificates.

Mr. Goldie: I am satisfied, but it did strike me that it was a point worth considering.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clauses 4 to 8 ordered to stand part of the Bill.

CLAUSE 9.—(Re-enactment of s. 37 (6) of principal Act.)

Major Milner: I beg to move, in page 9, line 13, to leave out "1940," and to insert "1941."
This Amendment will merely bring this Bill when it becomes an Act into the category of Solicitors Acts, 1932 to 1941.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 10.—(Discretion of Registrar in special cases to refuse practising certificate or issue same subject to terms and conditions.)

Major Milner: I beg to move, in page 10, line 12, to leave out "of," and to insert "or."

This and the following Amendment correct printers' errors.

Amendment agreed to.

Further Amendment made: In page 10, line 12, leave out "or" and insert "of."—[Major Milner.]

Clause, as amended, ordered to stand part of the Bill.

Clauses 11 to 17 ordered to stand part of the Bill.

CLAUSE 18.—(Council to make rules as to certain matters.)

Major Milner: I beg to move, in page 15, line 36, to leave out Sub-section (3), and to add:
(3) Rules made under paragraph (a) or paragraph (6) of Sub-section (1) of this Section shall not apply to—

(a) a solicitor acting in the course of his employment as a public officer as defined by Section four of the Solicitors Act, 1933; or
(b) a solicitor acting in the course of his employment in an office to which Section five of that Act applies; or
(c) a solicitor in whole-time employment as an officer of a local authority as defined by Section six of that Act acting as such officer."

I apologise for the absence of the hon. Member for Gillingham (Sir R. Gower), in whose name this Amendment appears, who has sent me a message that he cannot be present. This Clause makes provision for the making of rules and the keeping of books. Obviously it should not apply to the categories of solicitors set out in the Amendment who hold public offices. The same classes have been excluded from similar obligations which have been laid down in previous Statutes.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clauses 19 to 22 ordered to stand part of the Bill.

CLAUSE 23.—(Amendment of Sections 47, 48 and 49 of principal Act.)

Mr. Douglas: I beg to move, in page 16, line 25, to leave out Subsection (1).
This Clause does something which is obnoxious to the spirit of English law, that is, to place upon a person the obligation of proving that he is innocent of a criminal offence before placing the onus of proof upon the prosecutor. I think it is a great pity that such a Clause should be inserted in a Bill, above all in a Bill of this character. The legal profession themselves admit that it is a very exceptional circumstance. Under the law of our country people are not required to prove their innocence before an endeavour has been made to prove their guilt. It is a practice which obtains in certain cases, but they are very exceptional ones, and I do not think Parliament has ever liked that principle or had any desire to extend it. Although in this case it may be for

the convenience of solicitors that such a high-handed practice should be adopted, I hope the Committee will not agree to it, and that those in the Committee who are responsible for the promotion of the Bill will see the wisdom of not pressing this proposal.

Mr. Garro Jones: I took occasion on the Second Reading of this Bill to draw the attention of the learned Attorney-General to this novel principle and to ask him to be good enough to look into it on grounds of equity, and I now support what has been said by my hon. Friend on grounds of common sense. It will be utterly impossible for any person who prepares any of these legal documents to prove to any court what his expectations were. This Sub-section is really only stultifying the language of the Act and the other common sense provisions in it. The Bill will be no worse, indeed will be greatly improved, if this provision is left out. It has given rise to a good deal of alarm among people who are in the habit of preparing legal documents—estate agents, chartered accountants and people of no professional qualifications at all. The restriction upon them still remains, and if they do receive a fee or reward for preparing these legal documents then they can be proceeded against under the Act as it stands without this Sub-section. I hope this obnoxious Sub-section can be left out.

Mr. Goldie: I am sure my hon. Friend the Member for North Aberdeen (Mr. Garro Jones) will forgive me if I take a totally different point of view. I am a barrister, but in the Division in which I practise I do not think I am likely ever to receive a fee or reward for preparing any instrument relating to real or personal estate. Surely the whole essence of this business is to prevent the drawing of legal documents by people who are not lawyers. As I see it, the offence consists in drawing a legal document when you are not entitled or qualified so to do. Then what happens? If you draw a legal document you are not liable to any penalty if you can show that you have not done it in the expectation of any fee, gain, or reward. The throwing of the onus of proof upon a defendant is something which is absolutely anathema to any practising lawyer and must be strictly discouraged, but here all that we are saying is, "By doing what


you have done you have committed an offence, and the way out is to show that you were acting in an amateur way and will not get any fee." I fail to see that such a provision is a case of throwing the onus of proof upon a defendant.

Mr. Garro Jones: My hon. and learned Friend is really begging the question. The whole point is upon whom the onus of proof should be cast, and it is a principle of English law, without any exception so far as I am aware—except in the criminal law—that the onus of proving guilt should rest upon the prosecutor. In this case the onus of proof is shifted, but only for the benefit of solicitors, to protect the profession of solicitors; and it seems to me that to make this exception in favour of solicitors will raise a great many charges of partiality. If one of the persons to whom I have referred, a chartered accountant or estate agent, prepares a legal document for fee or reward he can be sued under this Act without this Subsection, and a penalty can be imposed.

Major Milner: Will the hon. Member say how one is going to prove that a fee or reward was received?

Mr. Goldie: It could be done by an inspection of the books.

Mr. Garro Jones: Whatever difficulties there may be in proving that a fee or reward was received or is to be given it is certain that there will be many more difficulties in proving that a fee or reward was not received. But that is not all that the poor defendant has to prove. He has to prove that he is not even expected to receive a fee or reward. On the Second Reading I quoted one of the oldest tags, one which we learned in our earliest years, namely, that the thoughts of man are not triable, for the Devil himself could not know the thoughts of man; but here we are insisting that the poor defendant shall be compelled to prove what his thoughts were.

The Attorney-General: Any provision which even appears to shift the onus of proof should, of course, receive very careful scrutiny in this Committee, and after the speech of my hon. Friend the Member for North Aberdeen (Mr. Garro Jones) on Second Reading I carefully looked into this question. He was then, I think, under a misapprehension. He referred, for example, to wills, but this provision does not apply in such a case.

Mr. Garro Jones: I only gave wills as an example, but what I had in mind was any form of legal document—documents about the formation of a company or a lease from week to week or from year to year. The example is beside the point.

The Attorney-General: I think it was the clear intention of Parliament when it passed the Solicitors Act not to protect solicitors but to protect the public, and it has therefore been provided that certain classes of instruments affecting real or personal estate, or legal proceedings, or land registry transfers and charges, or documents with regard to probate, should be prepared by those who are technically qualified to do so. If they make a mistake they can then be sued for negligence.

Mr. Garro Jones: My right hon. and learned Friend said that they could be sued for negligence if they made mistakes, but you cannot defend this provision on that ground, because some branches of the legal profession cannot be sued.

The Attorney-General: People in every branch of the legal profession arc qualified by long training and experience in the drawing-up of these documents in proper form. I am clear about it in my own mind that Parliament never intended that estate agents, and professional persons other than persons legally qualified, should make it part of their business to draw up these documents and say, "We do not charge for drawing up the documents." There was the case of an estate agent who put up a sign outside his office which said, "Land registry. Forms drawn up without fee." He had to attract people into his office, and although there was no fee on the account for drawing up the forms, he was making this work part of his general business. I am sure that Parliament intended to stop that sort of thing.
The Law Society want to protect the public by making clear the intention of Parliament. There is no doubt difficulty in establishing whether any fee has been taken by a land agent or a surveyor, but it is contrary to every intention of Parliament for these people to make this work a subsidiary part of their business. Where a man does the work in the hope of increasing his clientèle, the Law Society has made out a good case.

Amendment negatived.

Clause ordered to stand part of the Bill.

Clause 24 to 29 ordered to stand part of the Bill.

CLAUSE 30.—(Short title, collective title, commencement and extent.)

Major Milner: I beg to move, in page 19, line 33, after "Sections," to insert:
Provided that Section one shall not come into operation until after the termination of the period during which the Emergency Powers (Defence) Act, 1939, is in force.
Clause 1, which is the operative Clause, relates to the proposed delivery of accountants' certificates and to the examination of solicitors' books, accounts and documents. The solicitors' profession would have preferred this Bill to come into force at once. Originally the Bill was drawn up to enable it to be brought into force when the Lord Chancellor thought fit, but it was the almost unanimous opinion at a meeting of solicitors that the matter should not be delayed but should be brought into force at once. Unfortunately that is not possible, because it would require the employment of a number of accountants and others who are not available because many of them are serving in His Majesty's Forces. It is a matter of regret that the operative Clause cannot be brought into operation at the present time, and therefore I hope the Committee will agree that it shall not be brought into force until after the termination of the period during which the Emergency Powers (Defence) Act is in force. Accountants will then be available, solicitors will have been able to pick up their practice and everything will be done properly.

Amendment agreed to.

Further Amendments made:

In page 19, line 33, leave out "or any."—[Major Milner.]

In line 35, after the first "Act," insert "Subject to the provisions of this Act."

In line 36, leave out "August," and insert "January."

In line 36, leave out "forty-one," and insert "forty-two."—[Mr. Silkin.]

Clause, as amended, ordered to stand part of the Bill.

Schedules agreed to.

Bill reported, with Amendments; as amended, considered; read the Third time, and passed, with Amendments.

NATIONAL EXPENDITURE.

Sir Adam Maitland: I beg to move,
That it be an Instruction to the Select Committee on National Expenditure that they do report to the House the Minutes of their Proceedings upon 6th August.

Mr. Garro Jones: In seconding the Motion which has been proposed by the hon. Member for Faversham (Sir A. Maitland), I am under the handicap of a long-standing but salutary rule of the House that it is not competent to a Member to refer to the proceedings before a Select Committee until the Report of that Committee has been laid upon the Table of the House. But in view of the new powers that have been made available since this Motion was placed upon the Order Paper, I have taken the opportunity of looking up the precedents in the matter, and I find that it has always been permitted, as of course should be obvious, to hon. Members proposing and seconding such Motions to say enough to enable the House to understand what the Motion is about.
On 29th May the House passed an Order which empowered the Co-ordinating Sub-Committee of the Select Committee on National Expenditure, in cases where considerations of national security preclude the publishing of certain recommendations and of the arguments on which they are based, to address a Memorandum to the Prime Minister for the consideration of the War Cabinet, provided that the Select Committee do report to the House on every occasion on which this power shall have been exercised. It is within the recollection of the House that until quite recently that power had been exercised once, and a report was duly made to the House. A few weeks ago the question of the Motion which was passed by the House on 29th May again came up for interpretation by the relevant sub-committees of the Select Committee on National Expenditure. A certain report had been prepared by the operating Sub-Committee on Air Services which they desired to submit to the House, but it was held by the Co-ordinating Sub-Committee that questions of public security arose and that therefore the report should be sent direct to the Prime Minister instead of to the House.
Through this arose the question which has come before us in an acute form once


or twice recently, the question which has been pithily described by the Prime Minister as the question of what is a matter which is dangerous to the country and what is a matter which is a nuisance to the Government. I think it can be said—indeed it would be an affectation to pretend that this is not known to a great many quarters inside and outside the House—that the hon. Members of the Air Sub-Committee of the Select Committee considered that the report in question contained no element of public security but contained elements which might perhaps be embarrassing or difficult to the Government. The Coordinating Sub-Committee took a different view, but were unable to satisfy the hon. Members of the Air Sub-Committee that their first view was incorrect. The four hon. Members concerned are the hon. Member for Faversham (Sir A. Maitland), who has proposed this Motion and who is the chairman of that Sub-Committee, the hon. Member for North Camberwell (Mr. Ammon), the hon. Member for West Birmingham (Mr. Higgs) and the hon. Member for Central Bradford (Mr. Leach). Seeing that they were quite unable to reach an accommodation with the Coordinating Sub-Committee, they felt that they had no other course open to them but to resign in a body from the Select Committee on National Expenditure.
I trust I have not impinged upon any Rule of the House. This Motion on the Order Paper, as is so often the case in our proceedings, conceals behind or beneath a very simple formal Motion a matter of the utmost importance in Parliamentary procedure, and a matter of great public interest, and I felt it incumbent upon me, in seconding the Motion, to say briefly what the issue is that the House has to discuss.

Mr. Silkin: I want only to say that it seems rather a pity that this matter should have been developed at all in the absence of the Chairman of the Select Committee, the hon. Member for Kidderminster (Sir J. Wardlaw-Milne). The facts that my hon. Friend has just stated are within my own knowledge and are not quite correct. The matter came before the whole of the Select Committee, not merely before the Co-ordinating Sub-Committee, and there was a decision there which upheld the latter's decision. I think it would have been better if the whole matter could have been left until notice had been given to the Chairman of the Select Committee, so that he could have had an opportunity of making a statement upon the matters which have been put before the House.

Mr. Garro Jones: On that point I may say briefly, since my hon. Friend has thought it right to bring into question the propriety of my action, that had his view carried the day, the House would have passed a Motion of which it knew absolutely nothing at all, and it was therefore only what appeared to me to be common sense that the House, even in war-time, should know what was the principle underlying the Motion proposed.

Question put, and agreed to.

Ordered,
That it be an Instruction 'to the Select Committee on National Expenditure that they do report to the House the Minutes of their Proceedings upon 6th August.

The remaining Orders were read and postponed.

ADJOURNMENT.

Resolved, "That this House do now adjourn."—[Major Dugdale.]